The AAT has allowed a truck driver’s claims for unsubstantiated food and drink expenses that were claimed on the basis of the Commissioner’s daily rates.

The taxpayer is a full-time employee truck driver. In the year ended 30 June 2011, he claimed deductions for the cost of food and drink consumed by him at roadhouses and service stations along the interstate routes driven by him. He also claimed other work-related expenses, most of which were resolved before or on the day of the hearing. The tribunal said the taxpayer did not keep any receipts for his purchases of food and drink, and relied on the relief from the substantiation provisions on the basis that he was in receipt of travel allowances from his employers in the relevant year. Accordingly, he based his claim for the deductions on the Commissioner’s reasonable daily rates.

The Commissioner audited the taxpayer and formed the view he was not in receipt of travel allowances that allow him relief from the substantiation provisions and, therefore, he could not use the Commissioner’s reasonable daily rates. The Commissioner disallowed the deductions claimed (as well as other claims). The taxpayer objected to the assessment and his objection was allowed in part only. He then applied to the Tribunal for a review of the Commissioner’s objection decision.

The Tribunal considered the allowances received by the taxpayer were “travel allowances”, ie they were amounts paid by his employers to him to cover his losses or outgoings incurred for travel away from his ordinary residence and for losses or outgoings for food or drink – the AAT said this was clear from the payroll manager’s letters. The Tribunal concluded that the taxpayer was entitled to claim the deductions for the food and drink expenses. It also decided he was entitled to claim a deduction for his entire claim with respect to his mobile phone expenses.

(AAT Case [2013] AATA 920, Re Gleeson and FCT, AAT, Lazanas SM, AAT Ref: 2013/0763, 20 December 2013.)

[LTN 3, 7/1/14]