Private ruling: Work related expenses
Date of advice: 17 November 2020
Published: January 2021
Ruling period: Year ended 30 June 20XX
Date scheme commenced: 1 July 20XX

Ruling: Q1: Are you entitled to a deduction for the cost of moisturiser and protective barrier creams under section 8-1 of the Income Tax Assessment Act 1997 to protect your face from skin conditions which arise as a consequence of being required to wear a highly protective air-tight face mask while you are working in the health care industry? | A1: Yes

Relevant facts and circumstances: You work in the health care industry and are employed by a health care organisation. When carrying out your employment duties, you are required to wear various forms or personal protective equipment (PPE). Face masks (respiratory protective equipment) form part of this PPE and are traditionally worn on an adhoc basis for a relatively short duration. During the Covid-19 pandemic, highly protective PPE has been supplied by your employer. This includes a face mask rated as P2/N95 designed to filter the air and block particles above a certain size. When worn correctly, the face mask is intended to form an air-tight seal around the edges. These face masks are different to general use face masks in that they have a pressure seal which allows no air to escape or be drawn in. Your employer, and normal medical protocols, require that PPE including the air-tight face mask be worn for all patient contact and also in the workplace when not undertaking normal patient care. As a consequence, the face masks may be worn for between 10 to 16 hours in a 24-hour period. The air-tight face mask supplied by your employer does not have venting to outside air so that it protects you from the Covid-19 virus. The environment between your skin and the face mask becomes hot and humid as a result. This environment can result in heat rashes and various forms of dermatitis. Prolonged wearing of such non-venting face masks can also result in contact irritation or minor pressure injuries. Your employer recently issued a safety notice reporting irritation and dermatitis conditions on the face with P2/N95 face masks. Amongst other controls, your employer lists the purchase of moisturiser and barrier creams. As well, your employer's contracted medical advisory service detailed likely adverse skin conditions which can result from prolonged mask use and recognised the need to use moisturiser and barrier creams to protect and manage against these skin reactions. Specifically, it is recommended moisturiser be applied at least once a day before wearing a face mask and a barrier cream be applied when wearing a face mask. You intend to wear moisturiser and barrier creams as set out in the statement by your employers contracted medical advisory service. These moisturisers and barrier creams are effective in the treatment of your skin conditions.

Relevant legislative provisions: Income Tax Assessment Act 1997 Section 8-1

Reasons for decision: Summary: Section 8-1 of the Income Tax Assessment Act 1997 (ITAA 1997) allows a deduction for all losses and outgoings to the extent to which they are incurred in gaining or producing assessable income, except where the outgoings are of a capital, private or domestic nature, or relate to the earning of exempt income. Paragraphs 7 and 8 Taxation Ruling 2003/16 Income tax: deductibility of protective items (TR 2003/16) state- 7. You can deduct expenditure on a protective item you use to protect you from the risk of illness or injury if: • you incurred the expense; • there is a sufficient connection between the expenditure and earning your assessable income so that the outgoing is incidental and relevant to the gaining of assessable income; and • the expenditure has the essential character of an outgoing incurred in gaining your assessable income. 8. Expenditure on a protective item will have a sufficient connection with the earning of your assessable income where: • you are exposed to the risk of illness or injury in the course of carrying out your income earning activities; • the risk is not remote or negligible; • the protective item is of a kind that provides protection from that risk and would reasonably be expected to be used in the circumstances; and • you use the item in the course of carrying out your income earning activities. The Covid-19 pandemic has created an environment in which it is necessary to wear non-venting face masks (and other PPE) for extended periods, sometimes for up to 16 hours in a 24-hour period. Because the face mask is non-venting, the air inside the mask exposes you to a high risk of skin irritation and various forms of dermatitis. Accordingly, the environment in which you are currently working has exposed you to an increased risk of facial skin irritation and various forms of dermatitis. It has the necessary connection with your activities as an emergency paramedic. You employer has acknowledged that facial skin irritation and various forms of dermatitis as a result of having to wear the non-venting mask for long periods of time is common, so the risk is not remote or negligible. Moisturiser and barrier cream provide protection from facial skin irritation and various forms of dermatitis when worn in conjunction with the face mask you are required to wear to perform your duties as an emergency paramedic. Therefore, because: • the moisturiser and barrier cream you intend to purchase is for the relief or prevention of severe irritation of facial skin and dermatitis, and • your current working environment as a heath care worker being required to wear a non-vented face mask during the Covid-19 pandemic, has exposed you to an increased risk of these conditions, the costs you incur to purchase moisturiser and barrier cream are deductible. However, if the moisturiser or barrier cream is used for any purpose other than to protect your face from severe skin irritation or dermatitis as a result of wearing a non-vented mask while you are carrying out your employment activities, you will need to apportion the costs and only claim the work-related portion as a deduction.