Final rulings on deductible expenditure

The ATO has also issued the following taxation determinations dealing with the deductibility of certain items of expenditure:

  • TD 2016/14: A taxpayer who carries on a business is entitled to a deduction under s8-1 of the ITAA 1997 for an outgoing incurred on a gift to a former or current client if the gift is characterised as being made for the purpose of producing future assessable income
  • TD 2016/15: An employer is entitled to a deduction under s8-1 of the ITAA 1997 for the annual fees incurred on an airport lounge membership for use by its employees where that membership is provided because of the employment relationship. However, annual fees will not be deductible to the extent they are incurred in relation to gaining or producing exempt income or non-assessable non-exempt income.