Fireman wins tax battle

Press, 10 February 1988, Page 26

Fireman wins tax battle

PA Wellington A fire-fighter has won a battle with the Inland Revenue Department over whether medical, life and welfare premiums are tax deductible. The department refused to allow the deductions when a claim was made by the fire-fighter in his 1984 tax return. Premiums for a union life insurance policy and contributions to the Fire Brigade Welfare Fund were not compulsory, and although the premium to a medical policy was compulsory, it was not incurred while earning income, the department said. Also, benefits which might arise from payments would occur only when the fire-fighter was not working, so were of a “private or domestic” nature, it said. However, Judge Barber of the Taxation Review Authority has overruled the department. The .voluntary life insurance and welfare fund payments were in effect compulsory, he said in a written judgment. All three schemes benefited the employer because they contributed to the fire-fighter’s peace of mind when he undertook the dangerous tasks required of him. They provided ongoing assistance to the firefighter’s employment process, Judge Barber said. Their main objective was to provide stability of employment and performance. Any personal benefit which might come later was merely a consequence of that, he said.