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Work Related Deductions – Personal Care Services
Has the scope range of deductions expanded for work related claims?

A recent case concerned whether expenditure incurred by a tax payer with a disability was entitled to a deduction for employing an assistant to assist her in conducting her employment activities.  The tax payer was engaged as a law clerk and had physical disabilities that prevented her from typing and handling files etc.

A personal care worker was engaged to attend to some of the work functions, such as typing, photocopying, handling files and moving items on the desk, but also providing some personal care assistance.

In the words of the judgement "the administrative assistant is basically performing the role that legs, hands and fingers play for able bodies (sic) legal clerks and lawyers".

The tribunal considered that seven-eights of expenses were fully deductible after a private ruling application was in the negative.  The one-eight was attributed to personal hygiene and care.

The view was that the non-personal services provide by the attendant involved outgoings incurred to enable the tax payer to undertake her employment activities and accordingly deductible under the normal deduction provisions.  The expenses included wages, superannuation, advertising, insurance and training of the assistant.

The Commissioner has indicated that he accepts the tribunal's decision.

The tribunal also indicated that despite expenses being claimed under the general deductions, they may also be claimed under the medical rebate provisions.

The decision is not one that is considered to permit employees to claim deductions for delegating their work, merely the principle is reaffirmed that deductions need to be incurred for the purpose of generating assessable income.

 

 



18th-September-2008