AAT upholds decision to disallow deductions for work-related car expenses

The Administrative Appeals Tribunal has affirmed the decision of the Commissioner in the case Rafferty v Taxation and Commercial Division to disallow deductions claimed by the taxpayer in relation to work-related car expenses on the basis that they were private in nature. The Tribunal held that the taxpayer was not required to transport protective clothing equipment to and from the workplace as secure locker facilities were provided by the employer.

Taxation Determination on main residence exemption

The ATO has published the following Taxation Determination which deals with the application of the capital gains tax (CGT) main residence exemption:

·       TD 2017/13: According to the Determination, the main residence CGT exemption will not be available for a dwelling that is a separate CGT asset for any part of the dwelling's ownership period before it becomes the main residence unless the taxpayer has made a valid choice under subsection 118-150 of the ITAA 1997 to treat the dwelling as the main residence during some or all of the period when the dwelling was being constructed.

Interest income on a bank account

The ATO has released Taxation Determination TD 2017/11 which states that Interest income on a bank account is assessable to the person(s) who beneficially own the money in the account. This Determination consolidates the ATO views previously expressed in a number of other ATO guidance products:

·       IT 2486: Children's Savings accounts

·       TD 92/106: Who should be assessed to interest earned on a joint back account?

·       TD 92/182: A taxpayer appoints another person as a joint signatory to operate a bank account in the taxpayer's name, if she becomes ill or is absent from Australia for any length of time. The taxpayer retains sole beneficial entitlement to the money in the bank account. Is the appointee assessable on any of the interest income derived?

·       TD 93/148: are monetary gifts received by a child or any interest earned on investing such money treated as 'excepted assessable income'