Presentation: TR 95/12 - ATO Ruling on Tax Deductions and Allowances

This assignment is a presentation analyzing ATO Ruling TR 95/12, which focuses on the tax implications for factory workers. The presentation covers general deductions, the application of the law to the circumstances discussed in the ruling, and an assessment of its correctness. It includes the discussion of relevant legal precedent and the protection the ruling provides to those who follow it. The presentation also offers alternative viewpoints, a practical example of the ruling's application, and supporting materials. The ruling addresses the taxability of allowances and reimbursements, deductions for work-related expenses, and references relevant legal precedent. The presentation aims to demonstrate a comprehensive understanding of the ruling's implications in the context of Australian taxation law.

Taxation Ruling
TR 95/12

About the Ruling:
• The ruling is mainly applicable on the employee factory workers.
• The factory workers are those that are indulge in the process
workers and operators of machine.
• A machine operator involves person that are employed to carryout
discrete items of stationary mechanical processing equipment for
performing single function at single stage of manufacturing
procedure.
• Workers involved in the processing of materials particularly, rubber,
glass, wood, food, fabric, plastics and stone products.

Tasks performed by factory
worker under this ruling:
• Fixing of attachments, setting controls, loading of
materials and preparing surfaces before operations
• Sampling out and checking quality
• Maintaining of production records
• Cleaning and lubricating machinery as well as repairing
small objects
• The ruling is not applied on the plant operators, data
processing and operators of business machine.

The ruling deals with:
• The ruling is mainly dealing regarding the taxability of
allowances and reimbursements got by the factor workers
• Deductions for the expenses associated to work which can
be claimed by factory workers.
• The ruling discusses regarding the taxability of allowances
and reimbursement within “sec 25 and “paragraphs 26
(e) of ITAA 1936”.

Effective date:
• The ruling is applicable to years that are starting both
prior to and following the date of issue.
• The ruling is not applied on taxpayer till the extent it
comes in conflict with settlement terms of dispute which is
agreed prior to the issue date of ruling.

Allowances:
• Receiving allowances simply do not automatically allows a
factory worker for a tax deduction. If the allowances
received fall in the following categories:
• Completely taxable to employee that has probable
deduction allowance
• Completely taxable to employee that has no deduction
allowance despite receiving allowances
• Completely taxable to employee with deduction allowed
for outgoings occurred subject to specific substantial
rules.

References
• Woellner, R., Barkoczy, S., Murphy, S., Evans, C. and Pinto,
D., 2016. Australian Taxation Law 2016. OUP Catalogue.
• Ato.gov.au. 2020. Legal Database. [online] Available at:
<https://www.ato.gov.au/law/view/document?
src=hs&pit=99991231235958&arc=false&start=1&pageSi
ze=10&total=5&num=4&docid=TXR%2FTR9512%2FNAT
%2FATO%2F00001&dc=false&stype=find&tm=phrase-
basic-tr%2095%2F12#P24> [Accessed 7 April 2020].