Ogden and Commissioner of Taxation (Taxation) [2016] AATA 32: False Work Related Expenses

Friday 19 February 2016 @ 9.57 a.m. | Taxation

A Sydney man who was found to have made false work related claims pertaining to his income by the Australian Tax Office (ATO) will now have to pay a hefty penalty after the Administrative Appeals Tribunal (AAT) dismissed his dispute. His work-related expenses claimed included items such as a “Dora the Explorer” pencil case and heart and star shaped stickers.


Gary Ogden was formerly employed as a salesperson by IBM Australia and as such, had the privilege of working from home. For the 2011 financial year, Mr. Ogden claimed more than $50,000 on work-related expenses. In 2012, he similarly claimed just under $50,000 in work related expenses. Amongst his claims were for secretarial duties performed by his seven year old son amounting to $5,388. Furthermore, he claimed thousands of dollars of groceries as work-related expenses.

The ATO disallowed various tax deductions claimed by Mr. Ogden and imposed a penalty on him on the basis that Gary and his agent had failed to “take reasonable care” or comply with tax laws when claiming the expenses. Mr. Ogden disputed the matter and took it before the Administrative Appeals Tribunal.

AAT Decision

Deputy President Stephen Frost had no trouble in dismissing Mr. Ogden’s claims. Regarding the matter of secretarial duties performed by Mr. Ogden’s son, Frost DP said:

“I find that Mr Ogden’s son did virtually nothing for his father by way of secretarial assistance or anything of that nature…Indeed, the evidence established no more than that the son sometimes ran upstairs to the study when the phone was ringing, answered the phone and then handed it to his father.”

It was also concluded that the son was not paid anywhere near the vicinity of $5,388 for his duties. Regarding the grocery items, the tribunal noted that it would be a strange thing to offer business partners or clients cheese from a can. The tribunal held it was more than likely that the items claimed subsisted of Mr. Ogden’s children’s needs. He said further:

“Without wishing to labour the point, I note that Mr Ogden also claimed, as deductible “stationery”, the following items – a wall chart, Texta colour pens, a “Dora the Explorer” pencil case, heart and star shaped stickers, crayons and art brushes. For the avoidance of doubt, I find that none of those were used in the course of gaining or producing his assessable income. Plainly, they are items purchased for use by his children.”

Thus, the dispute was dismissed and the ATO will finalise Mr. Ogden’s penalties soon. 

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