Dr. Jones is an Obstetrician. During the year she travels to New York for a conference on obstetrics. She incurs the cost of flights, taxis, meals, drinks and several nights accommodation at the Plaza Hotel. While in New York she purchases a new suit form Saks Fifth Avenue to wear to the conference, she also purchases a new white medical coat to wear while visiting some hospitals. After returning to Australia she has a nervous breakdown at work and pays $1,200 for private psychiatrist treatment to prevent this from occurring again. Discuss whether Dr. Jones is entitled to a general deduction for any of these expenses?

Answer:

As per Australian tax law (ATO guidelines), medical professionals can claim a deduction for travel expenses, uniforms, clothing, personal protective equipment (PPE), and the purchase of equipment, tools, and similar assets.The cost of taxis, meals, drinks and several nights of accommodation comes under travel expense, while a new suit and white medical coat come under clothing and protective equipment.Therefore, Dr. Jones can claim a deduction for these items.

Expenses ($1200) incurred for private psychiatrist treatment are not deductible as they are a private expense not covered under health insurance.Even though this breakdown happened at work, this private expense cannot be claimed to be deducted from taxable income.