Deduction for Transport Between Workplaces.

Specific travel expenses can again be claimed between different workplaces following recent tax changes.

A court decision in 2001 surprisingly overturned the Australian Taxation Office view that travel between two workplaces was allowable.  The rules have again been liberalised with amending legislation - approved on 29 June 2004, but applicable from 1 July 2001.

The new provision provides an individual taxpayer with a specific income tax deduction for transport expenses where the following conditions are met:

• the individual incurs transport expenses in travelling directly between workplaces;
• the purpose of the travel between workplaces is to earn assessable income at the second workplace:
• at the time of the travel between workplaces the income earning activities at the first workplace had not permanently ceased; and
• the individual does not reside at either place.

A workplace includes:

• a place where an individual earns assessable income as an employee
• a place where an individual earns assessable income in a capacity other than as an employee; and
• a place where an individual earns assessable income by carrying on a business or business activities.

A deduction can be claimed for transport expenses incurred in travelling directly (i.e. no detours) between:

• two places of employment; 
• two places of business; and
• a place of employment and a place of business.

Note: that if the individual resides at one of the two workplaces no travel deduction is allowable. 

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