Carey Group Quarterly Newsletter

Claiming Rent and Travel Costs: What the Hall Case Means for You

A recent decision by the Administrative Appeals Tribunal (AAT) has shed light on how taxpayers may successfully claim rent and travel expenses due to pandemic-related work changes – and it’s a case worth paying attention to.

The Hall Case: A Win for Remote Workers

In the case of Hall and Commissioner of Taxation [2025] ARTA 600, the AAT ruled in favour of Mr. Hall, who claimed:

• Home occupancy expenses – including rent and utilities for a dedicated workspace at home.
• Car expenses – for travel directly related to his income-earning activities

The tribunal found that these costs were incurred in the course of producing assessable income, making them legitimate deductions under sections 8-1 and 28-12 of the Income Tax Assessment Act 1997.

ATO Pushback and Ongoing Appeal

Despite the ruling, the ATO has lodged an appeal, arguing that such deductions should be limited under existing guidelines:

• TR 93/30 – Income tax: Deductions for home office expenses.
• TR 2021/1 – When transport expenses are deductible for employees.
• Employee Guide for Work Expenses – Which restricts claims for travel starting and ending at home, and for home office expenses without a dedicated workspace.

Why This Matters

This case could reshape how deductions are assessed for:

• Employees working from home due to COVID-19 or flexible arrangements.
• Professionals using personal vehicles for work-related travel.
• Individuals renting spaces specifically for business use.

If the appeal is unsuccessful, it may broaden the scope of what’s considered deductible — especially for those with clear documentation and a genuine work-related purpose.

How to Document Your Claims

To strengthen your position:

• Keep detailed records of rent payments, utility bills, and workspace setup.
• Log travel distances, purposes, and dates using a diary or app.
• Ensure your home office is exclusively used for work and not shared with personal activities.
• Avoid claiming expenses that are partly private or not directly related to income generation.

Stay Informed and Compliant

While the final outcome of the Hall case is pending, it’s essential to follow current ATO guidelines and seek professional advice. If your work situation has changed due to the pandemic, you may be eligible for deductions – but only if they’re properly documented and clearly linked to your income.

Check what’s allowed – and what’s not – before lodging your return.