SE31640 - The Schedule E expenses rule: each and every holder

Section 198(1) ICTA 1988 permits a deduction for expenses incurred by the holder of an office or employment. It does not refer to the expenses incurred by any individual holder or a holder of an office or employment.

This means that the test is an objective one. It looks at the requirements of the job itself rather than the circumstances or preferences of any particular individual doing it.

It follows that an expense is only deductible if it is an expense that each and every holder of that office or employment would have to incur. The Courts have consistently supported this approach in a series of decided cases.

The effect of this rule is illustrated by example SE31643.