Private ruling: Work-related expenses
Published: September 2014
Ruling period: Year ended 30 June 2014
Date scheme commenced: 1 July 2013

Ruling: Q1: Are you entitled to a deduction for the cost of applying for a Working with Children Check (WWCC) clearance? | A1: Yes.

Relevant facts and circumstances: You have worked for the same employer for a number of years. Your employment puts you in contact with children. Due to the implementation of legislative changes in your state you were required to obtain a WWCC clearance. As an existing employee you were required to obtain the clearance to remain in your employment. You have not been reimbursed by your employer for the application fee.

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. A deduction is not allowable for the cost of obtaining a clearance check when it is a prerequisite to starting work as the expense is incurred at a point to soon. The outgoing precedes the earning of assessable income and it is a capital expense. In your case, you have been working for the same employer for several years and due to legislative changes in your state you were required to apply for a WWCC clearance to remain in your employment. It is considered that as you are an existing employee the requirement to obtain the WWCC clearance was for you to continue to derive assessable income and preserve your existing income stream. The necessary nexus between the outgoing and the income is therefore established and the cost of obtaining the WWCC clearance is deductible. . Therefore, the cost of obtaining the WWCC clearance is deductible under section 8-1 of the ITAA 1997.