Draft Taxation Determination

TD 94/D1

Income tax: Where a taxi driver travels between his/her principal place of residence and the collection point of a taxi, are the costs of travel deductible?

• Please note that the PDF version is the authorised version of this draft ruling.
  This document has been finalised by TD 94/17.

FOI status:

draft only - for comment

Preamble

1. No. The private nature of travel to and from a place of employment is generally well established at law, except in specific circumstances. [see Lunney v. FCT; Hayley v. FCT 100 C.L.R. 478, 7 AITR 166]

2. In this instance, the underlying purpose of the travel is to transport the taxi driver to the point where income derivation may occur. As such, the expense is incurred preparatory to, and in anticipation of, the earning of assessable income rather than having been incurred in deriving that income. Accordingly it is not an allowable deduction under sub section 51(1) of the Income Tax Assessment Act (1936). [see FCT v. Genys 87 ATC 4875, 19 ATR 356]

Example:

3. Bill Jones travels from his home to a place where he collects a taxi cab and commences driving a taxi shift. He collects the taxi cab at 4 o'clock in the morning and no public transport to the place is available.

4. Notwithstanding the lack of transport and erratic hours of employment [Case U156, 87 ATC 908], the travel retains its private character and arises as a consequence of Bill living in one place and commencing work in another, hence any expense incurred in that travel is not deductible.

Commissioner of Taxation
6 January 1994

References

BO UMG 0091

Subject References:
taxis
travel
travel between home and work

Legislative References:
ITAA 51(1)

Case References:
Lunney & Hayley v FCT
100 CLR 478
7 AITR 166

FCT v Genys
87 ATC 4875
19 AITR 356
Case U156
87 ATC 908