CASE 72/96

Members:
JR Dwyer SM

Tribunal:
Administrative Appeals Tribunal

Decision date: 6 December 1996

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J Dwyer (Senior Member)

This is an application for review of an objection decision of the respondent made on 16 October 1995 in respect of the year of income ended 30 June 1994.

2. At the hearing Mr A Soliman, an accountant, appeared for the applicant. Ms A Richards of Counsel appeared for the Commissioner of Taxation. The Tribunal received in evidence the documents (``the T documents'') lodged pursuant to s 37 of the Administrative Appeals Tribunal Act 1975 and the exhibits tendered during the hearing. The applicant gave evidence.

3. The issue before the Tribunal is whether the sum of $4,250, which the applicant claimed she spent on hairdressing and make-up, clothing and jewellery during the year of income ended 30 June 1994, was an allowable deduction under s 51(1) of the Income Tax Assessment Act 1936 (``the Act'').

4. The applicant has at all material times been a television newsreader. It is not in issue that she earned assessable income in that occupation and that she was also paid the sum of $2,000 as a clothing allowance for the purchase of clothing for use on camera. The applicant claimed that she spent the amount of the allowance, and also other amounts which were set out in her substantiation schedule as follows:

``Hairdressing     1951

  Clothing         1979

  Jewellery         320''
      

5. The applicant was advised by letter dated 16 October 1995 that her claims were disallowed as they were considered to be ``private expenses''. In her notice of objection lodged on 15 August 1995 the applicant claimed:

``The said sum of $4250.00 represent [sic] money spent on Clothing, Hairdressing, Beautycare and Jewellery were outgoings incurred by me in gaining and producing my assessable income, and necessary [sic] incurred by me in keeping my position as Camera Reporter. The Clothing which I claimed are being used only on camera because the colour and design are not suitable for private and daily use. The Jewellery and the Accesories [sic] are also used for the purpose of appearing on camera, therefore they are allowable deductions under the provisions of Sec. 51(1) of the said Act.

The Beautycare and Hairdressing are necessary for appearing on the T.V. and are not an optional but they are compulsory expenses, and are very necessary expenses to gain assessable income, therefore they are allowable deductions under the provisions of Sec. 51(1) of the said Act.''

The relevant legislation

6. The applicant's claim arises under the provisions of s 51(1) of the Act. That section so far as relevant provides for a deduction of:

``... outgoings to the extent to which they are incurred in gaining or producing the assessable income... except to the extent to which they are... outgoings... of a... private or domestic nature...''

Thus, to succeed in this application the applicant must show that the amounts expended were an outgoing incurred in gaining assessable income, that is to say, in gaining her salary as a television newsreader. She must also show that

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the expenses, even if incurred in gaining assessable income, were not outgoings of a private nature.

7. The Taxation Administration Act 1953 imposes an onus of proof on the applicant in matters such as this. Section 14ZZK provides:

``14ZZK On an application for review of a reviewable objection decision:

• (a) the applicant is, unless the AAT orders otherwise, limited to the grounds stated in the taxation objection to which the decision relates; and
• (b) the applicant has the burden of proving that:
  • (i) if the taxation decision concerned is an assessment (other than a franking assessment) - the assessment is excessive; or
  • (ii) if the taxation decision concerned is a franking assessment - the assessment is incorrect; or
  • (iii) in any other case - the taxation decision concerned should not have been made or should have been made differently.''

8. Both parties relied on the Federal Court decision of
Mansfield v FC of T 96 ATC 4001. That is indeed a relevant decision. The facts are similar. Furthermore the parties there, as in this matter, seem to have been more concerned about the principles involved than about the evidence as to actual expenditure. Hill J said at p 4003:

``The fact that there was a threshold issue appears rather to have escaped the attention of those who advised Mrs Mansfield. The evidence as filed was largely directed at the wider issue of deductibility to a hypothetical flight attendant of amounts of this kind, rather than to the specific issue of whether an amount of $1,215, or some part of that amount, was allowable as a deduction to Mrs Mansfield. Indeed, counsel for Mrs Mansfield appeared to have been taken by surprise when it became clear during the course of the hearing that the Commissioner, at any event, preferred to argue the question of whether Mrs Mansfield had satisfied the onus of proof under s 190(b) of the Income Tax Assessment Act 1936 (Cth) (`the Act'), in showing that she had incurred the amount of $1,215, rather than to embark upon the issue of principle which counsel for Mrs Mansfield desired to litigate.

This Court has an obligation to consider with care any issue which is properly brought before it and, within reason, a litigant may argue any ground which he or she chooses. However, it is to be hoped that the parties do not believe that the time of this Court should be spent considering the question of whether an amount of something less than $500 in tax was payable by a particular taxpayer. The cost to the community of the Commissioner employing senior and junior counsel to argue that proposition can hardly be justified by reference to the amount of tax payable. It can only be justified by reference to the wider issue which counsel for Mrs Mansfield sought to agitate.

In the result, leave was given to counsel for Mrs Mansfield to adduce further evidence to overcome the deficiencies of evidence manifest at the time the hearing commenced....''

9. Here too, the evidence seemed to have been considered by the parties, at least until the hearing, as subsidiary to the issue of deductibility of the costs of clothing and grooming of a television newsreader. However I cannot decide the matter on general principles alone. My findings must be made on the evidence before me and in accordance with the onus of proof requirements of the Act. As will appear in the analysis of the evidence later in these reasons, there were many inconsistencies between the statements made in the written objection lodged on behalf of the applicant and her evidence. There were also gaps and inconsistencies in the evidence.

10. One such gap was the lack of evidence from the television channel as to its requirements for grooming and clothing worn by its newsreaders. The evidence of the applicant was that she considered her appearance on screen was important. I find that it is important. But there was no evidence as to how the channel monitored that performance or as to the requirements of management as to the appearance of newsreaders.

11. At the commencement of the hearing Mr Soliman sought to tender a statement by a manager of the channel. When Ms Richards said that she would wish to cross-examine the

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author of the statement and referred to the fact that at a directions hearing just one week earlier Mr Soliman had said that no witnesses other than the applicant would be called, the applicant chose not to tender the letter rather than have the manager called for cross-examination. She maintained that approach even when the Tribunal raised with her the possibility that arrangements could be made for the writer of the statement to attend at another stage, if he could not attend at short notice on the day of the hearing.

12. In Mansfield Hill J said there was no suggestion that Ms Mansfield's evidence should not be accepted. In this matter, because of the inconsistencies between the applicant's case as set out in the documentation prior to the hearing and at the hearing and because of some inconsistencies in her evidence, I cannot simply accept her evidence. It seems that neither the applicant nor Mr Soliman had appreciated before the hearing that the onus of showing that the assessment was excessive was on the applicant, and that in order to discharge that onus evidence before the Tribunal would need to be accurate and detailed, rather than simply general assertions, which could not be supported by sworn evidence.

13. During the hearing both Mr Soliman and Ms Richards referred the Tribunal to taxation rulings said to be applicable to this matter. Part IVAAA of the Taxation Administration Act 1953 gives the Commissioner of Taxation the power to make taxation rulings. Section 14ZAAD provides:

``A public ruling on the way in which a tax law applies may be a ruling on the way in which a discretion of the Commissioner under that law would be exercised.''

Section 14ZAAF provides:

``The Commissioner may make a public ruling on the way in which, in the Commissioner's opinion, a tax law or tax laws would apply to a class of persons in relation to an arrangement.''

14. Mr Soliman referred the Tribunal to Taxation Ruling IT 124, which covers ``Expenses incurred by professional entertainers''. That ruling was in force at the relevant time, 30 June 1994, and still applies to deductions claimed in respect of the income year 1993/4, although it was replaced on 16 June 1995 by Taxation Ruling TR 95/20. The respondent contended that Ruling IT 124 did not apply to television newsreaders. It is stated to apply to professional entertainers and in paragraph 11 of the ruling that group is described as including ``television personalities, public entertainers, mannequins, etc''. There is also reference to ``artists'' in the ruling. There was no detailed submission or argument as to whether the applicant is a ``television personality''. Mr Soliman said he relied on the ruling. Ms Richards submitted that it did not apply. Neither of them addressed me on the issue in such a way as to explain the basis of their submission on the point. On the material before me I do not find that the applicant could be characterised as a professional entertainer or a television personality, although she does appear on television as a newsreader. However even if I had held that the ruling did apply in this matter I can see no justification in the Act, once the matter comes before the Tribunal, for allowing half the costs claimed for hairdressing or conventional clothing expenses in the absence of evidence supporting the deduction.

15. The respondent referred the Tribunal to Taxation Ruling TR 94/22 which covers ``Income Tax Implications of the Edwards Case for the Deductibility of Expenditure on Conventional Clothing by Employees.'' That Ruling applies to years commencing before and after the date of issue of the ruling, that is to say it includes the income year 1993/4. As I have found that the clothing claimed to be deductible in this matter is conventional clothing, that ruling seems to apply. That ruling states in part:

``5. We accept that the proper construction of subsection 51(1) does not result in any universal proposition that conventional clothing can never attract deductibility under the Act. Each case must be approached by the application of the subsection properly construed to its particular facts.

6. The analysis on the facts starts with ascertaining what are the income earning activities and then determining whether a sufficient nexus exists between those activities and the expenditure. Outgoings will be deductible in whole or in part where there is a clear connection between the expenditure and the actual derivation of income. It is not sufficient that the expenditure on clothing is a prerequisite to the derivation of assessable income. It must contribute to the derivation of that income.

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7. It is our view, that in most cases expenditure on conventional clothing will not be deductible.''

The approach I have adopted in this matter is to apply s 51(1) to the facts as I have found them.

The issues

16. Decided cases show that it is not easy to determine whether expenditure on clothing and jewellery which is worn for income earning activities, and the cost of hair care and make- up, where a person's appearance is important for their employment, is properly described as:

• (i) incurred in gaining assessable income, or as
• (ii) outgoings of a private or domestic nature.

17. The relevant authorities were considered by Hill J in Mansfield. His Honour referred to
FC of T v Cooper 91 ATC 4396. Mr Cooper was a footballer who failed in his attempt to obtain a deduction for expenditure on additional food consumed to combat weight loss during the football season. The Full Court of the Federal Court, by majority, disallowed the deduction finding that there was not the relevant nexus between the increased food consumption and the playing of professional football. As Lockhart J explained at p 4403:

``The taxpayer was paid money to train for and play football, not to consume food and drink. His income producing activities did not include the consumption of food and drink.''

18. The first issue I must consider is the essential nature of the expenditure. Was there, in the words of Hill J in Mansfield at p 4006:

``... a real connection between the expenditure and [the applicant's] activities as an employee, which activities are directed at her obtaining wages?''

The applicant was not asked in evidence to describe her employment duties. So far as can be gathered from her evidence they seem to include interviewing people on camera in respect of news stories and presenting news and other reports on TV. I find that her employment requires her to have interviewing and reading skills and to have a TV image and manner which will be appealing to viewers so that they will watch her channel. The difficulty is to decide whether that requirement of an appealing television image is sufficient to render all or any of the expenses incurred in creating and maintaining that image ``outgoings incurred in gaining the assessable income''. In order to decide that question it is necessary to consider the evidence and the authorities as to each of the categories of expenditure claimed as a deduction.

Clothing

19. In the written objection to the disallowance of the claim for clothing, hair care and jewellery, Mr Soliman referred to the applicant's appearances on television and stated:

``DRESS STANDARDS OF EMPLOYMENT

[The applicant] has to choose camera friendly colours, a primary colour that comes up best on camera. eg:

• • Any pattern affects the camera
• • Can't wear white
• • No short sleeves allowed on camera, even in very hot days
• • All Clothing has to have a collar
• • All clothes have to be designed - Business alike
• • Special colours have to worn only on camera, `camera can change colour' (eg. blue can be seen as green)

...

Accordingly the Channel... General Rules and Restrictions that apply are as follows:

• 1. One outfit cannot be seen more than once a month
• 2. Hair cut of special way to maintain the hair in good shape while she's reading the report on camera
• 3. Special clothing as per regulation
• 4. Jewellery has to be Gold or any other colour but not Silver
• 5. Special colour shoes to match the outfit & special high heel shoes (ie. High heels to be of thick heels and not of thin heels).''

20. It was apparent from the applicant's evidence that there are no ``General Rules and Restrictions'' or regulations of the channel at all. Thus the clothing cannot be ``as per regulation''. The applicant said that when she was interviewed for her position, she already

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had television experience and so she went dressed in the type of clothes that she knew would get her a television job. She said she wore a suit that would appear well on TV, as well as appropriate TV make-up, because she knew that she would be given an on-camera test at that stage. She said that she knew that certain colours and patterns and certain cuts do not come up well on camera, so she dressed appropriately to appear technically compatible with the type of camera that would be used. The applicant said that because of her prior experience as a TV reporter she knew what to wear to look appropriate and to create the desired image. She did not say that after obtaining the position for which she applied, she had been given any directions or rules about her appearance on camera. She said:

``Well, mostly they are unwritten rules, you only gain knowledge of through prior experience.''

21. In evidence the applicant referred to only one occasion when she had received instructions about her clothing. She said that she had once worn a brown jacket ``that was clearly not a TV jacket''. She explained:

``I knew that but that's all I had for the day, I had complaints, people ringing up that night after the news saying: `That looks terrible and don't ever wear that again and she doesn't look appropriate.' So the next day my boss said: `Get rid of that jacket.' So I knew that if I wore that brown jacket again that my boss would look on me unfavourably and that, you know, if cost- cutting came maybe I would get the chop.''

22. The applicant also said that she can't wear the same clothing day in day out, so she has a wide variety of clothes, so that they are not seen too often. She explained some of her knowledge as to ``TV friendly'' clothing. She said:

``TV-friendly clothes are clothes that don't strobe, clothes that don't flare - white flares terribly. If I wore a white jacket it would [be] like I was burning up. Stripes that are close together would affect the camera also, they would start to buzz and pulsate. Of course, I can't wear anything that is revealing or off the shoulder or high neck; I couldn't wear anything high neck because it looks like I've got no neck.

Even in summer. Even in summer you have to wear...?... Even in summer I've got to wear long sleeves, I can't wear short sleeves.

In the high temperature when you are reporting outside...?... No matter what the temperature is I cannot wear sleeveless....''

23. As to the colours which are ``TV- friendly'' the applicant said:

``Basically, they are primary colours, strong reds, strong blues, yellows are acceptable and the reason is because certain colours don't come up well. Certain colours will make you look washed out, certain colours will make you look old, certain colours will make you look too young and because I have an image to fit... I select the appropriate colours. Certain reds will bleed on camera so it looks like my jacket is all fuzzy around the edge. And it's only through years of experience that I have come to understand what certain reds will not appear well on TV.''

24. The applicant said that she usually buys her clothes from wholesalers recommended by her TV channel but occasionally she buys from a conventional store. The applicant said that she had to wear earrings because her hair style exposed her ears and if she didn't wear earrings there would be calls from viewers commenting on that. She said that she also needs to wear appropriate clothing and shoes to get in and out of a helicopter and to walk around when she is interviewing people out of the studio. She said that sometimes she does a story which requires special clothing such as at the Melbourne Cup or on Hayman Island.

25. In cross-examination Ms Richards asked the applicant to compare the receipts for items which she claimed had been paid by her employer, with the receipts for items she claimed were purchased in addition to those items. Each list contained an Ojay brown jacket and top for $188 but the applicant said they were different outfits. The applicant agreed with Ms Richards that none of the items for which receipts were produced had come from shops specialising in corporate dressing.

26. In her Statement of Facts and Contentions the applicant stated:

``Clothing has been claimed as a deduction because it is bought for on camera appearances. The styles, colors and cuts

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required by television are specific, both technically and aesthetically...

The `look' of the clothes must be current, in fashion, conservative to suit the Channel... image and the demographics.''

In cross-examination she agreed with the suggestions put to her that all employees are expected to dress suitably for their employment in accordance with their respective occupations, and that when a person is employed in a professional capacity the usual expectation as to mode of dress is ``current but conservative''. During cross-examination Ms Richards showed a video of 11 occasions on which the applicant read the news on TV.

27. Not only do I find on the evidence that there are no written General Rules and Regulations of the employer, I also find that if there are unwritten rules, as described by the applicant in her evidence, they are rules of the industry, part of the knowledge of those who work in it rather than rules of the employer. Further, I find they are not strictly complied with by the applicant. For instance, she claimed ``any pattern affects the cameras'' but in the video she wore a patterned shirt on 29 June 1996 and 1 July 1996. Further, the items of clothing which were paid for by the applicant's employer as part of her $2,000 clothing allowance include a pink floral belt, top and skirt. When asked to explain this the applicant said that certain florals are satisfactory on TV. The applicant wore a striped jacket on 8 July 1996 and a striped shirt collar on 19 July 1996. In spite of the statement in the written objection, ``all clothing has to have a collar'', there was no shirt collar apparent on 30 June 1996, 8 July 1996, 9 July 1996. When the applicant was asked about these apparent exceptions to the rules she set out in her Statement of Facts and Contentions she indicated that the rules were flexible as some stripes and patterns were suitable for television and collars were usually worn but not necessarily worn for each appearance.

28. As Mrs Mansfield was an air hostess who wore a uniform, the only claim in respect of clothing in Mansfield was for shoes and hosiery. In regard to deductibility of clothing, Hill J said, at p 4008:

``It must be conceded that it is difficult to express as a general principle the circumstances when expenditure on clothing may be deductible and those circumstances when it will not be. The mere fact that a particular form of clothing is required to be used in an occupation or profession will not necessarily lead to the conclusion that expenditure on that form of clothing was deductible.

It can be said that generally expenditure on ordinary articles of apparel will not be deductible, notwithstanding that such expenditure is necessary to ensure a suitable appearance in a particular job or profession. An employed solicitor may be required to dress in an appropriate way by his or her employer, but that fact alone would not bring about the result that the expenditure was deductible. On the other hand the expenditure in Edwards [
FC of T v Edwards 94 ATC 4255] was expenditure upon clothing which might be said to be `ordinary' in the sense that it was capable of being worn by Mrs Edwards on occasions outside her employment, albeit that it was such that she would be most unlikely so to do for private purposes. Yet the clothing was deductible, after an allowance had been made for personal use. In Edwards, however, some weight was given to the fact that the expenditure was on clothing additional to that necessary in Mrs Edwards ordinary life. Some weight was, no doubt, also given to the fact that the clothing was qualitatively different from that which Mrs Edwards wore in ordinary life.''

(emphasis added)

29. As to the particular shoes and hosiery in respect of which the deduction was claimed in Mansfield, Hill J said at pp 4008-4009:

``The shoes in the present case were required to be worn as part of the uniform. It is true that there was nothing to distinguish the shoes from shoes which a flight attendant might purchase for domestic purposes other than, on the evidence of the present case, colour. But there are other features besides the requirement that the shoes match the remaining parts of a flight attendant's uniform which assist the taxpayer here. There is the additional feature that the cabin pressure requires the shoes to be a half size too large for ordinary use. Further, of course, there is the fact that the taxpayer's employment brings about regular scuffing of the shoes. It is these features that

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lead, in my view, to the conclusion that the occasion of the outgoing on shoes, that is to say cabin shoes, should be seen as being found in the duties which Mrs Mansfield performed as a flight attendant in the year of income. It is unnecessary, therefore, for me to decide what the result may have been if her claim had been not merely to deduct expenditure on cabin shoes but also expenditure on blue high heeled shoes which could be worn to and from work as well as in the cabin and which, presumably, were not a half size too large for normal usage.

Hosiery

The question of deductibility of the cost of support hose is more difficult. In favour of a deduction is the fact that the hosiery has to be of a particular colour (although there is at least a choice of blue and grey) so as to conform with the rest of the uniform which Mrs Mansfield was required to wear. Otherwise, there is nothing which distinguishes Mrs Mansfield's expenditure on pantyhose, be it support hose or otherwise, from the expenditure of any woman engaged in employment who wears support hose, either by inclination or by virtue of the additional support which a support hose might give in a non-sedentary occupation.

Not without some doubt I take the view that the connection with employment is to be found in the fact that the pantyhose is part of the uniform which Mrs Mansfield is required to wear. It does not cease to be part of the uniform merely because a choice is given of two colours. As part of the uniform, so important to the image of an airline, it finds a differentiation from ordinary clothing, so that the necessary relationship is to be found between the expenditure on the pantyhose and Mrs Mansfield's occupation as a flight attendant, and likewise the essential character of the expenditure is not to be seen as private. In other words, the expenditure can be properly seen as work- related expenditure.''

30. I deduce from those passages that Mrs Mansfield's case was strengthened by the facts:

• (i) that she was obliged to wear a uniform by her employer;
• (ii) that the shoes and hosiery in respect of which she claimed a deduction were part of a uniform;
• (iii) that because of the cabin pressure her cabin shoes were required to be half a size too large for ordinary use; and
• (iv) that there was evidence of regular scuffing of cabin shoes because of the nature of the employment duties in the cabin.

31. His Honour's reasoning seems to indicate that if the clothing the subject of the claimed deduction had been unable to be distinguished from clothing a flight attendant might purchase for domestic purposes, and if it had not been required to be worn with a uniform, the outgoings would probably not have been found to have been incurred in gaining assessable income. His Honour made it clear that he was not making any decision in respect of blue high heeled shoes of a type which could have been worn to and from work and which were in Mrs Mansfield's usual size, even though they were worn with a uniform.

32. The applicant in this matter claimed the sum of $1979.00 for clothing. The particulars she provided of that amount in her statement of facts were as follows:

``Bone Blazer, cream top                     $  188.00
Wine colored stretch top -- Landes      $   20.00
Printed Dresses -- Sportsgirl           $  100.00
La Donna top                                 $   11.55
Sportsgirl blue top                          $   29.90
Black suede shoes                            $   89.95
Saks Khaki jacket and shirt                  $  489.00
Ojay brown jacket and top                    $  188.00
Trent Nathan purple cropped suit             $  650.00
Yellow cropped jacket -- White Heather  $  245.00
Total                                        $2,011.40''
      

33. I find that all those items of clothing are ``ordinary articles of apparel'' of the type that any professional or business woman might purchase to wear to work. The particular clothing purchased was not specified by the employer. I accept that the applicant chose clothing which she knew from experience would look good on television, but that alone is not enough to make the expenditure a deductible outgoing. If it were, the purchase of suits to wear to work by professional men would constitute a deductible outgoing.

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Something more is required to satisfy that test than that the clothing be purchased expressly to wear to work.

34. I consider this matter to be distinguishable from
FC of T v Edwards 94 ATC 4255; 49 FCR 318. The clothing in question there consisted of hats, gloves and full evening dress. It was not part of a conventional high quality working wardrobe, such as Ms Edwards had before she commenced employment as personal secretary to the wife of the Governor of Queensland. The clothing in respect of which she sought a deduction was clothing suitable for wearing for formal occasions outside the normal range of employment activities. Ms Edwards had to dress in a manner compatible with the dress of the Governor's wife and her clothes had to be appropriate to the formal occasions which she had to attend as part of her duties. They were clothes of a type rarely worn by people in the course of their employment. They were additional items which had to be added to Ms Edwards' normal working wardrobe, to allow her to be appropriately dressed for some of her income producing activities.

35. The applicant in this matter did give evidence that like Ms Edwards she sometimes changed her clothing a number of times a day. But she did not provide particulars which allowed any calculation of the increased expenditure on clothing necessitated by that requirement. If the applicant had provided full details of her whole expenditure on her working wardrobe it may have been possible to separate out items of expenditure incurred in gaining assessable income and to then decide whether or not they were items of expenditure of a private nature. Items purchased to wear to particular events which the applicant was obliged to attend in the course of her employment activities may then have been found to be expenses which were incurred in gaining assessable income and which were not of a private nature.

36. However, as Hill J pointed out in Mansfield, that is not clear. His Honour referred to
Mallalieu v Drummond [1983] 2 AC 861 where the House of Lords held that a female barrister was not entitled to deduct the cost of upkeep of a wardrobe of clothes of a design and colour suitable to be worn under her gown during court appearances. Lord Brightman, with whose reasons Lord Diplock, Lord Keith of Kinkel and Lord Roskill agreed, said that the general question was whether a self-employed person could maintain ``partly at the expense of the general body of taxpayers, a wardrobe of everyday clothes which are reserved for work''.

37. The relevant United Kingdom legislation required that in order to establish deductibility the expenditure must be ``exclusively'' for work. It was submitted that that requirement was met by the finding that Miss Mallalieu did keep her barrister's clothes exclusively for work purposes. Lord Brightman quoted with approval from the reasons of Goulding J in
Hillyer v Leeke (1976) 51 TC 90 at p 93, the following passage:

``The truth is that the employee has to wear something, and the nature of his job dictates what that something will be. It cannot be said that the expense of his clothing is wholly or exclusively incurred in the performance of the duties of the employment.... In the case of clothing the individual is wearing clothing for his own purposes of cover and comfort concurrently with wearing it in order to have the appearance which the job requires....''

38. In Mansfield, Hill J pointed to Mallalieu as indicating that there are matters of fact and degree involved. He referred to it as of some assistance notwithstanding the differences between the United Kingdom legislation and s 51(1) of the Act. A similar analysis to that of the House of Lords seems to have been adopted in Edwards where it was only certain ``special clothing'' required for occasions outside the usual sort of employment activities for which the deduction was upheld. Another matter where that analysis was accepted was in Case 48/94,
94 ATC 422. Senior Member Barbour there held that a professional public speaker and presenter, who kept separate ``A list'' clothes which she wore only for her presentations, was not entitled to a deduction under s 51(1) for the costs of purchasing those clothes. He said [at 427]:

``... While the A list clothes assisted in creating an image compatible with the applicant's perceptions of her clients' and audiences' expectations, her activities productive of income did not turn upon her wearing A list clothes, however important the applicant may have perceived these clothes to be in her presentation activities.''

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39. I consider that the position of a TV news presenter is very similar to that of a professional public speaker and presenter. A TV news presenter no doubt appears in front of a much larger audience, but in each case the content of the presentation is the significant reason why people watch the presentation, although if the presenter did not have a pleasing and appropriate image, his or her audiences may be reduced. Senior Member Barbour decided Case 48/94 primarily on the basis that the expense of buying the clothes was not an outgoing or expense incurred by the applicant in gaining assessable income. He then went on to say at pp 427-428:

``That the expense is not a business expense is also indicated by the very conventionality of the clothing. The applicant did not buy specific clothes for specific presentations (as an entertainer might) or have clothes that were specific and suited only for her employment or business (as a nurse might). The applicant chose to wear her A list clothes for business only, but this does not then enable the expense in purchasing those clothes to be treated as a business expense. Nor did she wear several changes of clothes while performing her duties, such that this expense for additional clothing was purely for the purpose of gaining or producing income, and hence properly regarded as a business expense, despite its conventionality (as in Edwards).

Alternatively, I would find that the essential character of the expenditure is private, and hence excluded as a deduction by subsection 51(1) ITAA. For it was essential that the applicant wear something to her income- producing activities, and her A list clothing was essentially a question of choice, however important she perceived it to be to her success or otherwise. Like clothing worn on any occasion, and for any employment, the applicant's clothing needed to be suitable for the purpose of wearing to that presentation, but this does not change its character to a business expense, and I would find that the nature of the expense is essentially private.''

40. In this matter it is not necessary for me to decide whether the purchase of clothing to be worn on camera by the applicant was an outgoing incurred in gaining the assessable income. That is because I am satisfied that the real reason why the expenditure is not deductible is that where clothing is not to be worn as part of a uniform, and is not of a special nature and to be worn in unusual circumstances, such as the clothes worn by the secretary to a Governor's wife on formal occasions, the expenditure is of a private nature. As Goulding J said in Hillyer v Leeke:

``the employee has to wear something and the nature of [the] job dictates what that something will be.''

Or as Senior Member Barbour said in Case 48/94:

``Like clothing worn on any occasion, and for any employment, the applicant's clothing needed to be suitable for the purpose of wearing to that presentation.''

The purchase of clothing of a conventional type, or of ``ordinary articles of apparel'' is an expenditure of a private nature and thus, as Hill J pointed out in Mansfield at p 4008:

``... will not be deductible, notwithstanding that such expenditure is necessary to ensure a suitable appearance in a particular job or profession.''

41. I find that the clothing described in the receipts and the clothing I saw on the video shown in evidence is appropriately described as ``ordinary articles of apparel'' of the type worn by many professional or business women. It was clothing likely to be worn by the well- dressed professional woman, rather than clothing made specifically for TV or other presenters. Although the applicant said that there are certain colours and patterns which ``strobe'' or look washed out or do not work on TV, and that she has found that certain colours do not suit her, she did not give evidence that her employer had any specific requirements as to the sort of clothes she must wear for her TV appearances. None of the items claimed related to specific clothes purchased for specific presentations or clothes that were suited only for her employment as a TV news reader. As set out in paragraph 28 the video excerpts of her presenting the news showed her breaking a number of ``rules'' which she had said were unwritten rules.

42. The applicant gave evidence that her preferred choice of clothing was more casual than that she wore on TV, and that she would prefer to wear jeans and more casual tops than those she wore for her employment. That is no

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doubt common to many people. Many business and professional men and women who wear suits to work prefer to, and do, wear more casual clothes when they are not working. That does not in my view stop the expenditure on their work clothing being an outgoing of a private nature.

43. Even though I accept the evidence that the applicant had to choose her work clothing, bearing in mind what clothing was ``TV- friendly'' and what suited her, I do not consider that is sufficient to establish that the expenditure on clothing was not an outgoing of a private nature. Similar considerations apply to many employees. Like any other working person who aims to project a certain image, the applicant's clothing had to be suitable to be worn in her employment. I agree with Senior Member Barbour in Case 48/94 that that fact does not change the character of the expense from a private to a business expense.

44. The applicant said that she could only wear an outfit once every four weeks but there was no evidence that this was a specific requirement of her employer. Nor was there evidence on which I could have calculated how much, if any, clothing the applicant had to buy to satisfy that requirement, beyond that which she would have had to buy if she worked in other employment. In order to make such a calculation it would have been necessary to take into account the clothing covered by the allowance provided by her employer (other than the pair of bathers) as the evidence is that the allowance had not been declared as assessable income.

45. I find that no part of the amount of $1979 for clothing is an allowable deduction under s 51(1) of the Act.

Hairdressing and make-up

46. The evidence as to expenditure on hairdressing and make-up was extremely unsatisfactory. As set out in paragraph 4 of these reasons, the applicant in her Statement of Facts and Contentions claimed that she spent $1951.00 on hairdressing in the relevant year as follows:

``Haircuts once a month at $65.00 each, approximately $780.00 per annum.

Colour treatment once a month at $1140.00 per annum.

The remainder of $1951 spent on hair products eg. hair spray which is essential to keep hair still especially in windy conditions.''

47. However the evidence at the hearing was in substance that those figures were fictitious and that the real expenditure included expenditure on make-up and moisturiser and was as set out in numerous receipts tendered in evidence as exhibit A2. Those receipts were summarised and itemised so far as possible in a list prepared by the respondent after the hearing concluded. As arranged during the hearing that list was forwarded by the respondent to the applicant's representative and was taken into evidence as exhibit R7. The items covered in those receipts total $1584.20. Some of the items, including the most expensive hairdressing item of $110.00 on 8 June 1994 were incurred while the applicant was on maternity leave. When this was pointed out to the applicant she said that she was called in to work on some days during her maternity leave. Although I gave her leave to provide particulars of those days no particulars were provided. There seems to be no relationship between the receipts tendered in evidence and the claim originally made for hair care of $1951, of which particulars were given in March 1996.

48. In regard to hairdressing the applicant gave evidence that she had to wear her hair in an appropriate style and that involved having it cut regularly, so that it was kept ``in style''. She said she coloured her hair, and had to use a lot of hairspray to make sure that it did not move on camera when she was reporting out in the field. She said she used a different sort of spray for studio appearances and she also used gel.

49. In regard to the claim to deduct the expense of purchasing make-up products the applicant gave evidence that she usually wears theatrical make-up to appear on TV, but occasionally she uses a conventional type of make-up that works well. The applicant said that she has to wear heavy make-up and that she applies it 3 or 4 times a day and needs heavy duty cleansers to remove it. She said:

``Very often the make-up department at Channel... will buy it for me and I'll pay them because they run in there quite a bit to buy make-up, so I don't have to go into the city all the time.''

In spite of that evidence, none of the receipts produced appeared to be for theatrical make-up

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or make-up purchased from the television channel. They were, so far as identifiable, for standard make-up such as Revlon or Lancome or Estee Lauder and seemed to have been purchased from pharmacies or department stores. The applicant did not claim that the receipts were for the purchase of theatrical make-up.

50. There was no evidence that the television channel had any specific make-up or grooming requirements. That seems to have been an issue left to the judgment and experience of the applicant. That was not the case in Mansfield. The evidence there was that Australian Airlines conducted training programmes which included advice on grooming and on the need for moisturisers to counteract dehydration during a flight. Further there were written minimum standards of dress and appearance in a booklet distributed to flight attendants. That booklet set out in some detail what was acceptable and what was not acceptable in matters of grooming and hair care as well as describing the shoes and hosiery which were to be worn by flight attendants. There was also evidence that flight attendants, when signing on for a shift, were checked for grooming and were subject to an annual performance review which entailed a monthly assessment of the state of uniforms and grooming. The Court accepted evidence that poor grooming could curtail promotion prospects or ultimately perhaps lead to dismissal.

51. In spite of that evidence Hill J in Mansfield did not hold that a flight attendant's hair care and grooming expenses were deductible. He upheld the claim for moisturisers, the necessity for which he found was brought about by the harsh conditions of employment which Mrs Mansfield was called on to endure. He held that the expenditure on moisturisers had the necessary connection with activities in the cabin itself which were directly relevant to the gaining of assessable income by way of salary. His Honour stated at pp 4007-4008:

``It is particularly critical for a flight attendant that he or she be well groomed and presented at all times. This is a requirement of the airline itself and there are obviously good reasons for it. The need for grooming is recognised in the Award under which Mrs Mansfield worked by the provision to her of an allowance. It is recognised in the training courses which she undertook, in the daily and monthly assessments of grooming and in the annual performance review.

As the cases indicate, the mere fact that a particular expenditure may be required to be made by the employer, while relevant will not be determinative of deductibility. The additional feature present in the present case is the fact that the occasion of the expenditure is to be found in Mrs Mansfield's working in the cabin, that is to say, in the dehydration brought about by pressurisation of the cabin at altitude.

In these circumstances I would hold that the expenditure claimed in respect of moisturisers for hydration is an allowable deduction under s 51(1). Because only the amount of $469 was claimed and because all of this has been shown to have been expended on moisturising for hydration, it becomes unnecessary to consider whether that part of the amount which Mrs Mansfield expended on makeup would be deductible.''

52. Because Hill J found that the whole amount claimed in respect of the purchase of make-up had been expended on moisturisers, he did not need to decide whether expenditure on make-up, other than the moisturisers required because of dehydration in the cabin, would be deductible. But he expressed a tentative view that it would not, saying, at p 4008:

``... Even if makeup as such is required by the airline as an incident of the employment, I am presently of the view that makeup retains an essential personal characteristic which excludes it from deductibility.''

Applying the analysis of Hill J in Mansfield to this matter, the purchase of special stage make- up for appearing on camera and special or additional purchases of cleansers for removing such heavy make-up would be an expenditure incurred in gaining assessable income. However there was no evidence at all on which I can quantify the expenditure on such items. As explained in paragraphs 47 and 48 of these reasons, they were not itemised or even referred to in the Applicant's Statement of Facts, Issues and Contentions. When the receipts were tendered in evidence as Exhibit A2, none were identified as being for the purchase of stage make-up or cleansers.

53. Hill J in Mansfield said as to the deduction claimed for hairdressing, at p 4009:

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ATC 652

``Mrs Mansfield has shown only that the sum of $100 has been outlaid on conditioner necessitated by the lack of humidity and pressurisation of the cabin. This amount falls in the same category as the moisturiser to which reference has already been made. The remaining expenditure on hairdressing, in my view, could not be deductible. The fact that Mrs Mansfield was required by her employer to be well groomed and presentable does not of itself operate to confer deductibility. Expenditure on hairdressing is of a private nature. There is no additional feature which shows any relationship between the expenditure on the one hand and Mrs Mansfield's employment as a flight attendant. The expenditure does not have the character of employment-related expenditure and in my view is not deductible. Her selection of a perm, which requires somewhat regular maintenance, is her choice. It is not occasioned by her employment.''

(emphasis added)

54. That passage indicates that expenditure on hairdressing or on ordinary make-up, in order to be well-groomed, is expenditure of a private nature. I accept the applicant's evidence that she has to use an extra strong hair spray when she is on location at a windy spot, and that she carries that hair spray in her bag for this purpose when she goes on location by helicopter. I find that requirement is something beyond normal grooming and if the evidence allowed me to identify the expenditure on extra strong hair spray, I would have found that it was an expense incurred in gaining income and not an expense of a private nature. However the receipts tendered are not sufficiently particularised for such an analysis. I find that ordinary make-up, other than special stage make-up worn on camera or cleansers for removing that special make-up, retains an essential personal characteristic which excludes it from deductibility.

55. I am not satisfied that any of the amount claimed to be expended on hairdressing or make-up should be allowed as a deductible outgoing under s 51(1) of the Act.

Jewellery

56. Although the applicant in the substantiation schedule contained in her taxation return claimed $320.00 as expenditure on jewellery she only claimed two items of jewellery in her Statement of Facts and Contentions. They were a gold chain for $190.00 and pearl earrings for $40.00. They are conventional items of jewellery. There is no evidence that the employer required them to be worn. I find that the expenditure on those items is of a private nature being similar to expenditure to maintain grooming and appearance suitable to the applicant's employment. Thus the sum of $230.00 is not a deductible outgoing under s 51(1).

Conclusion

57. I have not found that any of the outgoings claimed are deductible under s 51(1) of the Act. In Mansfield the deductions in issue totalled $1215. That sum included $1019 which had been paid by way of an allowance from Australian Airlines. The Commissioner of Taxation had included the allowance as part of the applicant's assessable income and had disallowed the whole of the claim for $1215.

58. Although Hill J allowed most of the claimed deductions he did make the point that if he had found that no deduction was available to Mrs Mansfield, then the allowance paid to her by Australian Airlines would have formed part of her assessable income. He said [at 4005-4006]:

``... The fact that an amount paid by an employer to an employee for services rendered constitutes an allowance in respect of expenditure which the employee is required to undertake does not permit the conclusion that the allowance is not income in ordinary concepts. But even if it were not income within ordinary concepts, it would clearly be an allowance falling with s 26(e) and thus made assessable income:
Smith v FC of T 87 ATC 4883; (1987) 164 CLR 513 and cf
Roads and Traffic Authority of NSW v FC of T 93 ATC 4508.''

The evidence was that the allowance paid by the applicant's employer in this matter was not returned by her as assessable income, but I was not asked to and did not consider the assessability of the allowance in this matter. It may be that the Commissioner considered that Taxation Ruling IT 124 applied to the applicant and that therefore it was appropriate to allow the applicant to deduct the cost of clothing paid for by the applicant's employer. That matter was not raised before me.

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59. The objection decision under review will be affirmed.