Income tax: are taxpayers entitled to a deduction for the cost of renewing a driver's licence?

No. While the holding of a driver's licence may be a condition of employment, it does not follow that the licence fees are deductible. They are private in nature and accordingly not deductible under subsection 51(1) of the Income Tax Assessment Act 1936 .

The right to drive on the public roads does not cease to be a private right merely because the taxpayer is employed in some capacity which involves the use of the public road system. (See Case R49 84 ATC 387; Case 104 (1984) 27 CTBR(NS) 836 ) Examples: (a) A police officer in the highway patrol is required to have a driver's licence for duty. The cost of renewing the licence is not deductible. (b) A travelling salesman requires a drivers licence to perform his duties. The cost of the licence is not deductible. (c) A truck driver needs an endorsed licence to perform duties. As in the normal course of events these types of endorsements do not add to the cost of the licence, the expenditure is not deductible. Only the payment of a premium on top of the cost of the standard licence would be an allowable deduction.