The AAT has affirmed the Commissioner’s decision to deny various work-related expenses that a taxpayer claimed for the 2008 income tax year as it found he had not discharged the onus of proof. It also affirmed the 25% administrative penalty imposed.

The taxpayer was a senior pilot employed by Regional Express Holdings. During the relevant period, he claimed various expenses including meals and accommodation, private car expenses, home office expenses, Foxtel fees, landline expenses, and credit card expense. After allowing a percentage of some expenses in the objection decision, the amount in dispute between the Commissioner and the taxpayer was id=”mce_marker”9,498.68. The taxpayer broadly argued that his employment required the expenditures in order to carry out his work.

The AAT found that based on the evidence, the taxpayer’s employer did not require him to have a home office and other equipment to carry out his duties, and that when travelling, the employer provided all overnight accommodation and other associated costs claimed by the taxpayer. Therefore, it found the taxpayer had not discharged the onus of proof under s 14ZZK of the TAA in relation to the deductions claimed.

In relation to the penalties, considering that the deductions claimed were approximately 50% of the total income of the taxpayer, the AAT noted that the taxpayer and his agent should have been more careful. Hence, it affirmed the 25% penalty as not being harsh as the taxpayer was careless in making the claims.

(AAT Case [2014] AATA 10, Re Yeates and FCT, AAT, Ref No 2012/2035, Letcher SM, 10 January 2014.)

[LTN 7, 13/1/14]