LAWS3101 Study Guide - Midterm Guide: Operating Expense, Title Search
Document Summary
Speci c deductions arise where a speci c provision in the legislation, outside division 8, provides the taxpayer with a deduction for an expense: s8-5. Section 25-5 of itaa 1997 proves taxpayers with a deduction for any expenditure incurred in managing their tax affairs . Tax affairs = expenses incurred in relation to the taxpayer"s income tax obligations. Non-business taxpayers are unlikely to be able to deduct the expenses under s8-1 because they would be classi ed as private or domestic expenses. The section also provides taxpayers with deductions for any expenses incurred in complying with an obligation imposed on the taxpayer by a commonwealth law where the obligation relates to the taxpayer"s tax affairs. The payment of income tax, amounts withheld or payable under the payg system, interest incurred in borrowing money to pay income tax etc are not deductible under s25-5. Tax-related expenditure are not deductible if the expenses are capital expenditure: s25-5.
