Private ruling: Deductions
Published: May 2015
Ruling period: Year ended 30 June 2015 | Year ended 30 June 2016 | Year ended 30 June 2017 | Year ended 30 June 2018 | Year ended 30 June 2019 | Year ended 30 June 2020.
Date scheme commenced: 1 July 2014

Ruling: Q1: Can you claim a deduction for all or part of the cost of your gym membership? | A1: No.

Relevant facts and circumstances: You underwent surgery for a medical condition. Early signs of pain began in XXXX when you first had x-rays. You continued to work in pain up until two days before your operation. After weeks of physiotherapy you returned to work. Your surgeon was happy for you to return to work in your usual job. Due to the physical nature of your job you continued physiotherapy at your own cost. You are now physically fit and want to maintain this level and build muscle around your new joint to protect it while you continue in this area of employment. You have looked for lighter work but there was nothing available due to limited skills. You joined the gym on the XXXX and you have requested a program to build muscles on all areas around both your hips to keep you in the workforce until retirement. You believe this will be of great benefit to your health.

Relevant legislative provisions: Income Tax Assessment Act 1936 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. Generally fitness expenses such as the cost of a gym membership are considered to be private in nature and no deduction is allowed. Taxation Rulings TR 95/13 Income tax: employee police officers - allowance, reimbursements and work-related deductions and TR 95/17 Income tax: employee work-related deductions of employees of the Australian Defence Force deal with the deductibility of gym membership fees for police officers and Australian Defence Force (ADF) members respectively. TR 95/13 states that a deduction is not allowable for fitness expenses for police officers as it is considered to be of a private nature. The only exception is if a police officer's income earning activities involve strenuous physical activities on a regular basis. Police Academy physical training activities, members of special emergency squads, diving squads and police officers who work regularly with police dogs and train them, may be able to demonstrate that their income producing activities demand a high level of physical fitness. TR 95/17 sets down a similar view for ADF members in that fitness expenses are not deductible. An example provided in the addendum of TR 95/17 refers to a member of the Special Air Services Regiment (SAS) who is paid to maintain a very high level of fitness being allowed to claim some fitness expenses. However, the level of fitness required of a SAS member and that of an ordinary infantryman is clearly differentiated. Both taxation rulings adhere to the principle that unless a taxpayer's normal duties require a very high (above and beyond normal) fitness level, deductibility of expenses will be denied. Taxation Determination TD 93/114 Income tax: is a police officer, who is required to maintain an adequate level of physical fitness in order to undertake police duties, entitled to claim a deduction for fitness related expenditure? also supports this view. A deduction is allowable for these costs if strenuous physical activity is an essential and regular element of the taxpayer's income-earning activities, such as a Police Academy physical training instructor or a member of the Special Air Services Regiment (SAS). Their costs would be incurred to maintain a level of fitness well above the general standard. In your case, whilst attending the gym and improving your strength will allow you to continue in your current employment, we do not consider the level of fitness required is at a level comparable to that well above the general standard. Therefore, the cost of your gym membership is considered to be a private expense and not deductible.