Taxation Determination TD 1999/62







This Taxation Determination is a 'public ruling' for the purposes of Part IVAAA of the Taxation Administration Act 1953 and is legally binding on the Commissioner. Taxation Rulings TR 92/1 and TR 97/16 together explain when a Determination is a public ruling and how it is legally binding on the Commissioner. | This Determination applies to years commencing both before and after its date of issue. However, this Determination does not apply to taxpayers to the extent that it conflicts with the terms of settlement of a dispute agreed to before the date of the Determination (see paragraphs 21 and 22 of Taxation Ruling TR 92/20). | 1. This Determination sets out the criteria to be considered in deciding whether clothing items constitute (wholly or in part) a compulsory corporate uniform/wardrobe. The cost of acquiring and maintaining a compulsory corporate uniform/wardrobe is an allowable deduction under section 8-1 of the Income Tax Assessment Act 1997 (see Taxation Ruling TR 97/12 - 'Income tax and fringe benefits tax: work related expenses: deductibility of expenses on clothing, uniform and footwear'). | 2. A compulsory uniform/wardrobe must be prescribed by the employer in an expressed policy that makes it a requirement for a particular class of employees to wear that uniform while at work, and which identifies the relevant employer. The employer's compulsory uniform/wardrobe policy guidelines should stipulate the characteristics of the colour, style and type of the clothing and accessories that qualify them as being a distinctive part of the compulsory uniform/wardrobe. Also, the wearing generally of the uniform/wardrobe should be strictly and consistently enforced. To be a compulsory corporate uniform/wardrobe, the clothing must be unique, distinctive and peculiar to the particular organisation, with a timeless quality unaffected by short term changes in fashion. | 3. Whether clothing constitutes a compulsory corporate uniform/wardrobe is a question of fact and impression that can only be determined on a case by case basis in the light of all the circumstances. The following criteria (failure to satisfy one or more of which does not necessarily mean the clothing is not a compulsory corporate uniform/wardrobe) should be considered: | 4. The explanation of the criteria in paragraph 3 is based, in part, on Case R55 84 ATC 411 at 416-419; 27 CTBR (NS) 867 at 874-877. | 5. A substantial change to a compulsory corporate wardrobe (e.g., a complete change in the style, colours or fabrics) would require the above criteria to be fully addressed for the whole wardrobe. A minor change (e.g., replacement of one or two items of clothing of an older or no longer desired style within a corporate wardrobe, or the addition of one or two new accessories) would not ordinarily be regarded as a substantial change and would not require the whole wardrobe to be reassessed.


Previous rulings: 6. Taxation Ruling IT 2641 is now withdrawn (it is replaced by this TD and Taxation Ruling TR 97/12). | Commissioner of Taxation 10 November 1999 | Not previously released in draft form
Legislative references: ITAA 1997 8-1
Case references: Case R55 84 ATC 411 27 CTBR (NS) 867
Subject references: corporate and compulsory clothing expenses