09 Mar Work-related expense claims rejected by Administrative Review Tribunal

The Administrative Review Tribunal (‘ART’) recently disallowed a taxpayer’s claims for many different types of work-related expenses.

The taxpayer was employed full-time as an engineer, working from home two days a week.  For the 2023 income year, he claimed deductions totalling over $61,000, in relation to (among other things) car expenses, travel expenses, clothing expenses, and home office expenses, all of which he claimed were work-related.  

The ATO largely disallowed these deductions, and the ART affirmed the ATO’s decision, primarily due to problems with substantiating these claims.

For example, in relation to the car expenses, the ART noted that none of the log books were contemporaneous, and the log book entries were inconsistent with independent records (e.g., car service records).

In relation to travel expenses (taxi and Uber fares), the ART noted that the taxpayer did not provide evidence clearly identifying which travel expenses had been reimbursed by his employer, and the ride share documentation did not include the date, time or destination of travel.

In relation to home office utility expenses, the ART noted that the taxpayer only provided calculations estimating the business use proportion of those expenses, without providing any documentary evidence to substantiate the expenses themselves.In any case, the ART was not satisfied that the taxpayer’s apportionment of those expenses was fair and reasonable.