The Australian Taxation Office (ATO) has issued an Interim Decision Impact Statement on the recent case of Hall and Commissioner of Taxation [2025] ARTA 600—a decision that could reshape how certain tax deductions are claimed in Australia.
This case revolves around whether a taxpayer can claim deductions for home occupancy expenses and car expenses under sections 8-1 and 28-12 of the Income Tax Assessment Act 1997.
What Happened in the Hall Case?
In this case, the Administrative Appeals Tribunal (AAT) found that Mr. Hall was entitled to claim:
- Home occupancy expenses (such as rent, mortgage interest, or utilities for a dedicated work space at home)
- Car expenses (used for travel directly related to his income-earning work)
The AAT ruled that both types of expenses were incurred in the course of producing assessable income—and therefore deductible.
However, the ATO disagrees with this ruling and has lodged an appeal.
What Are the Rules Right Now?
While the appeal is in process, the ATO says it will continue applying its existing interpretation based on:
- TR 93/30 – Income tax: Deductions for home office expenses
- TR 2021/1 – When transport expenses are deductible for employees
- ATO’s Employee Guide for Work Expenses
These guidelines limit deductions for working from home and transport, especially for employees without a dedicated home office or where the travel starts and ends at home.
Why This Case Matters to You
This case has significant implications for anyone who:
- Works from home (partially or full-time)
- Uses their car for work-related duties
- Runs a business from home
- Wants clarity on what they can claim without risking an ATO audit
The final decision (after the appeal) may widen or restrict what’s considered deductible in these areas—potentially impacting your future tax returns.
How Boa & Co. Can Help
With the ATO now challenging long-standing deduction boundaries, accurate and compliant tax advice is more important than ever. At Boa & Co. Chartered Accountants, we help individuals and business owners:
- Understand what deductions are currently allowed
- Avoid errors that could lead to ATO audits or penalties
- Maximise eligible claims while staying compliant with current ATO rulings
- Stay updated on legal and tax changes that affect your entitlements
Whether you’re a sole trader, professional working from home, or small business owner, we’ll help you stay informed and financially protected.
Need Tax Deduction Advice?
If you’re unsure how the Hall case or current ATO rules impact your situation, we’re here to help. Speak to the team at Boa & Co. Chartered Accountants for tailored, practical tax advice today.
Call us on 1300 952 286, Email [email protected], or Visit www.boanco.com.au to book your consultation.