Private ruling: Accommodation expenses
Published: December 2013
Ruling period: Year ended 30 June 2013 | Year ended 30 June 2014
Date scheme commenced: 1 July 2012

Ruling: Q1: When you incur deductible expenditure for accommodation, and you are accompanied by relatives, are you entitled to a deduction for a portion of your expenses? | A1: Yes.

Relevant facts and circumstances: You are employed at a base location in a regional city. You travel away from that base from time to time to meet staff and clients at various locations. You also attend meeting at head office which is a distance from your base location. Your employer will sometimes book and pay for the accommodation. On other occasions, you pay the costs up front, and your employer reimburses you for the costs incurred. Sometimes your employer will pay you an allowance and you must find and book the accommodation by yourself. The way in which the accommodation is organised and paid for depends on how far in advance the travel is organised. You are often accompanied by relatives when you travel. You incur additional costs so they can stay in accommodation with you when travelling.

Relevant legislative provisions: Income Tax Assessment Act 1997 section 8-1 | Income Tax Assessment Act 1997 subsection 26-30(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. Subsection 26-30(1) of the ITAA 1997 generally states that you cannot claim expenses attributable to your relative's travel, if: · you travelled in the course of performing your work duties, or in the course of carrying on a business for the purpose of gaining assessable income, and · your relative accompanied you while you travelled. In your case, sometimes your relatives accompany you when you travel in the course of performing your work duties. As per subsection 26-30(1), you cannot claim expenses attributable to your relative's travel. Consequently, you are only entitled to a deduction for a portion of the accommodation expenses you actually incur.