An employee is generally entitled to a deduction for the costs of travel between their home and an alternative work location
An ‘alternative work location’ is a work location where an employee’s duties of employment require them to travel to, other than their regular place of work. This may include a client’s premises or another office of an employer that an employee is required to work at temporarily.
In TR 2019/D7, the ATO upholds its longstanding view on travel to alternative work locations that an employee is generally entitled to a deduction for the costs of travel between their home and an alternative work location, as such expenses are typically characterized as being incurred in the course of gaining or producing their assessable income. This is the case even if private matters are incidentally attended to by the employee at, or en route to, the alternative work location.
However, an employee may not reduce their costs of travel between home and an alternative work location where their travel reflects a choice to work at a different location as a matter of convenience. Similarly, if an employee’s duties of employment are such that it is irrelevant where those duties are carried out, any travel they undertake to carry out these duties is a matter of mere convenience and is not deductible.
Travel between work locations (other than home)
Am employee who travels between work locations (neither of which is their home) is generally entitled to deduction for their costs of travel, provided these expenses are necessitated by their work duties. In this regard, relevant work locations that an employee may travel between include different workplaces of the same employer, clients of the employer and any other locations where the employee carries out employment duties.
A deduction is not available, however, where an employee’s travel results from personal circumstances. Neither does a deduction arise where the work locations are of different employers or different income earning activities. In the latter scenario, a deduction may nevertheless be available if the conditions in S.25-100 (discussed in previous articles) are satisfied.