The Australian Taxation Office perspective on work-related travel expense deductions for academics

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Abstract

This paper includes a case study of my own experiences as a
personal taxpayer being audited by the Australian Taxation Office (ATO) as
well as a legal analysis of Australian tax cases relating to the deductibility of
travel-related expenses. The personal case study explains Australia’s tax system
of Pay As You Go (PAYE) income tax deductions followed by annual tax
return submissions (using an honesty-based system) plus occasional subsequent
tax audits if deductible expenses claimed in tax returns are deemed excessive.
The case describes how the ATO initiated and handled my tax audit in 2013 to
2015 and the arguments put forward by the ATO officers as to why my
research-related tax deductions should be disallowed. The next part of the paper reviews the tax law cases in Australia’s past which have either allowed or
disallowed work-related travel expense deductions. This discussion concludes
with the Payne case of 1999 to 2001. Judges have now polarised themselves
into two discrete camps, those for deductibility looking at the composite
income-earning activities of the taxpayer (viewed in a holistic way) with those
against deductibility arguing that travel between two unrelated places of
employment or business is equivalent to travel between home and work.
Original languageEnglish
Pages (from-to)345-362
Number of pages18
JournalInternational Journal of Critical Accounting
Volume8
Issue number5-6
Early online date9 Jul 2016
DOIs
Publication statusPublished - 6 Jan 2017

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Keywords

  • Australian taxation
  • Australia
  • travel-related expenses
  • taxation law
  • Section 51(1)
  • Payne case
  • High Court
  • deductibility
  • Australian taxation law

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