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Yes, where the trauma policy is: (a) owned by an employer; (b) the employer is the beneficiary of the policy; (c) the premium is paid for a revenue purpose; and (d) the purpose of the policy is to advance the business ends of the taxpayer; then the premium is deductible under section 8-1 of the Income Tax Assessment Act 1997 ('the 1997 Act') (formerly subsection 51(1) of the Income Tax Assessment Act 1936 (the 1936 Act)).

A revenue purpose would exist where any benefit expected to be obtained by the employer under the policy was to cover the loss of profit, either on account of reduced income or increased expenditure, arising as a result of the loss of the employee through the occurrence of the insured event or condition under the trauma policy. There needs to be a nexus between the amount of the insurance benefit and the expected quantum of lost profits. A benefit received in these circumstances would constitute assessable income to the employer under section 6-5 of the 1997 Act. Note: The Addendum to this Determination that issued on 18 August 1999 applies in relation to the 1997-98 or a later income year.