Document ID: chunk:federal_register_of_legislation:C2025C00029:section:3:p3
Version: federal_register_of_legislation:C2025C00029
Segment Type: section
Provision Reference: s 3 (pt 3/34)
Character Range: 1666689–1669523

not stop the income being mainly a reward for your personal efforts or skills.

84‑10  This Part does not imply that individuals are employees
  The application of this Part to an individual does not imply, for the purposes of any *Australian law or any instrument made under an Australian law, that the individual is an employee.

Division 85—Deductions relating to personal services income

Guide to Division 85

85‑1  What this Division is about

      This Division sets out amounts, relating to personal services income, that an individual cannot deduct. In particular, deductions that are unavailable to an employee are similarly unavailable to an individual who has personal services income and who is not an employee.
      However, this Division does not apply if the individual is conducting a personal services business or receives the income as an employee or office holder.

Table of sections
85‑5 Object of this Division
85‑10 Deductions for non‑employees relating to personal services income
85‑15 Deductions for rent, mortgage interest, rates and land tax
85‑20 Deductions for payments to associates etc.
85‑25 Deductions for superannuation for associates
85‑30 Exception: personal services businesses
85‑35 Exception: employees, office holders and religious practitioners
85‑40 Application of Subdivision 900‑B to individuals who are not employees

Operative provisions

85‑5  Object of this Division
  The object of this Division is to ensure that individuals who are not conducting *personal services businesses cannot deduct certain amounts (such as amounts that employees cannot deduct).
Note: This Division also affects the extent to which a personal services entity is entitled to deductions relating to gaining or producing an individual's personal services income: see section 86‑60.

85‑10  Deductions for non‑employees relating to personal services income
 (1) You cannot deduct under this Act an amount to the extent that it relates to gaining or producing that part of your *ordinary income or *statutory income that is your *personal services income if:
 (a) the income is not payable to you as an employee; and
 (b) you would not be able to deduct the amount under this Act if the income were payable to you as an employee.
Example: Ruth is an architect who works as an independent contractor for one firm. She is not conducting a personal services business. On most days she travels from her home to the business premises of the firm, where she does her work. She also has a home office, where she does some of her work.
 This section confirms that Ruth cannot deduct her expenses of travelling between her home and the firm's premises because she could not deduct them if she were an employee.
 (2) Subsection (1) does not stop you deducting an amount to the extent that it relates to:
 (a) gaining