overnight travel expenses ato

19th July, 2021

Work travel expenses: What you can (and can’t) claim

Knowing exactly what deductions apply to travel expenses can save a heap of hassle at tax time.

The Australian Taxation Office (ATO) has released a new ruling that clarifies what expenses employees can deduct for work-related travel.

The new ruling, Income tax: When are deductions allowed for employees’ transport expenses? was released this week, bringing together and clarifying the rules for business advisors and their clients alike.

Key takeaways:

• The ATO’s new ruling sheds light on what travel expenses employees can and cannot claim
• Travel between work locations (neither of which are your home), is typically tax deductible
• Incidental work-related travel, such as a receptionist who makes a stop to pick up office newspapers on their way to work, can’t be claimed on tax

Travel from home to a regular place of work generally isn’t deductible. The ruling states that even if you travel to work by plane, receive a travel allowance or make incidental business-related stops on the way to work, you still cannot claim your travel expenses.

But moving between two separate work locations – like driving from your office to a construction site, or from your business to a meeting at a client’s office – can be claimed.

Tax specialist and accountant, Leo Hollestelle said the ruling is well timed ahead of the busy End of Financial Year period.

“It’s timely that these views are brought together and codified into a single ruling,” said Hollestelle. “Tax advisors will be able to more easily familiarise themselves with the rules and in turn advise their clients on it.”

What are work-related expenses?

Work-related expenses are expenses that you incur in the course of gaining or producing your assessable income.

What work-related travel expenses can I claim?

Transport expenses you incur while travelling between work locations are usually deductible. The travel must occur while gaining or producing your assessable income. 

While you can’t usually deduct expenses for travelling between your home and work, you might also be able to deduct the cost of travel from your home to somewhere other than your regular place of work. This might be, for example, to attend a client’s premises or one of your employer’s other offices. 

To work out if travel expenses are work-related, things like these are taken into consideration: 

• Does the travel fit within your duties of employment? 
• Do the travel expenses arise out of your employment and not your personal circumstances?
• Is the travel relevant to the practical demands of carrying out your work duties? 
• Has your employer asked you to travel?
• Has the travel occurred during normal work time?

What work-related travel expenses can’t I claim?

Transport expenses that you incur for travel between your home and a regular place of work are not deductible.

If there is a close connection between travel and your private or domestic life, this will usually not be considered deductible. For example, if you travel to your regular place of work from another location in which you undertake private activities, for example a library or a holiday house, the cost of the travel is not deductible. 

If you happen to live a significant distance from your regular place of work, your travel expenses are usually considered private and not deductible. 

You may also not deduct expenses that are capital, private or domestic in nature. Transport  expenses that may be considered capital in nature include, for example, the cost of purchasing a car. Ask your advisor whether such expenses may be recognised under another tax provision. 

How much can you claim for work-related expenses?

You can only claim the actual cost of the expenses themselves. These will need to be proven with receipts and/or other written documentation. Your advisor will be able to help you with this.

READ: How to save tax in Australia – 15 tax minimisation strategies

How to calculate work-related travel expenses

You can claim deductions for work-related travel expenses in your tax return , but how you do this depends on the expenses themselves. (See also Claiming overseas-travel expenses , below.)

If your expenses relate to a car you own, lease or hire, you may be able to use the logbook method or the kilometres method . 

READ: How long does it take to get a tax return?

Working-away-from-home tax deductions

If your employment requires you to travel away from home overnight, because of your employment (and not because of private circumstances like where you choose to live, for example), the transport expenses incurred in travelling to your alternative work location will usually be considered deductible.

Claiming overseas-travel expenses

If you travel overseas for work, you might be able to deduct expenses relating to flights, accommodation, meals, transport or other minor things (like taxis or using hotel wifi). You’ll need to keep records such as receipts and you may also need to keep a travel diary.

Where’s your regular place of work?

Interestingly, there are several exceptions that – if claimed correctly – can give you an edge come tax time. This is especially true when it comes to defining what a “regular work location” actually is.

For example, imagine you currently work for a business with an office 15-minutes from your home.

But you’re asked to cover a long-service vacancy for six months at another of your business’s offices one hour away. Because this new office becomes your regular place of work for a sustained period of time, travel to and from it cannot be claimed on tax.

But, if your period of work was only for three months, then it could be argued that the second office never became a regular place of work.

Therefore, travel could potentially be claimed on tax.

This is a call to take care in making any assumptions about what you can actually claim. As the ATO ruling states, ‘the full facts and circumstances of the specific working arrangement in place must always be considered in determining the nature and deductibility of the transport expenses incurred’.

And that’s something to keep in mind when it comes to all travel-related tax claims this tax time, as it could be this ruling also indicates an increase in scrutiny for travel-related claims.

“While the ruling is very much in line with the Commissioner’s existing views on travel expenses, the timing is worth noting,” said Hollestelle.

“After a year where many employees have been working from home, it may be the ATO is concerned there will be both workers and employers seeking to make dubious claims in the tax period ahead.”

What else do I need to know?

Find more guidance on transport and travel expenses on the ATO website. 

Always seek advice on your individual situation from an accredited business advisor or tax specialist to find out exactly how tax changes and updates might impact your business.

Need an advisor? Find one today with MYOB’s Find an Advisor directory .

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Can I claim the cost of flights as a work related travel expense?

During the last year I had to fly to Melbourne for work. My employer who didn’t really care about doing everything right - gave me a working away amount and paid for my accomodation. However they told me to pay for my airfares as I will be able to claim it back at tax time (I didn’t get any reimbursement on the airfares).

I assume I will be ok to claim the airfares but nothing else for the travel?

• Report as inappropriate

Most helpful reply

Hi @markw81 ,

If the travelling meant that you had to stay away from your home overnight, in the course of performing your employment duties. You can't be accompanied by family or have family or have family or friends visit you.

You can read more about what the eligibility rules are for overnight travel expenses and what other travel expenses you may be eligible to claim.

Don't forget you must have spent the money yourself and weren't reimbursed and you must have written evidence to support your claim.

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ATO Reasonable Travel Allowances

‘Reasonable’ allowances received in accordance with ATO’s reasonable travel allowances schedules are not required to be declared as income, and can be excluded from the expense substantiation requirements.

Per diem rate schedules of amounts considered reasonable are set out in Tax Determinations published by the Tax Office annually.

Tax Ruling TR 2004/6 describes the substantiation exception for expenses which are in line with the prescribed reasonable allowance amounts.

2021, 2022, 2023 and 2024 rates and for prior years are set out below.

The annual determinations set out updated ATO reasonable allowances for each financial year for:

• overtime meal expenses – for food and drink when working overtime
• domestic travel expenses – for accommodation, food and drink, and incidentals when travelling away from home overnight for work
• overseas travel expenses – for food and drink, and incidentals when travelling overseas for work

On this page:

2017- 18-Addendum

More information

Substantiation rules

Substantiation in practice

Alternative: Business travel expense claims

Distinguishing Travelling, Living Away and Accounting for Fringe Benefits

See also: Super for long-distance drivers – ATO

Allowances for 2023-24

The full document in PDF format: 2023-24 Determination TD TD 2023/3 (pdf).

The 2023-24 reasonable amount for overtime meal expenses is $35.65.

Reasonable amounts given for meals for employee truck drivers (domestic travel) are as follows:

• breakfast $28.75
• lunch $32.80
• dinner $56.60

For full details including domestic and overseas allowances in accordance with salary levels, refer to the full determination document:

2023-24 Domestic Travel

Table 1：Salary $138,790 or less

Table 2: Salary $138,791 to $247,020

Table 3: Salary $247,021 or more

Table 4: High cost country centres accommodation expenses

Table 5: Tier 2 country centres

Table 5a: Employee truck driver’s meals (food and drink)

2023-24 Overseas Travel

Table 6: Salary $138,790 or less

Table 7: Salary $138,791 to $247,020

Table 8: Salary $247,021 or more

Table 9: Table of countries

Table 1：Reasonable amounts for domestic travel expenses – employee’s annual salary $138,790 or less

Table 2: Reasonable amounts for domestic travel expenses – employee’s annual salary $138,791 to $247,020

Table 3: Reasonable amounts for domestic travel expenses – employee’s annual salary $247,021 or more

Table 4: Reasonable amounts for domestic travel expenses – high-cost country centres accommodation expenses

Table 5a: Reasonable amounts for domestic travel expenses – employee truck driver’s meals (food and drink)

Table 6: Reasonable amounts for overseas travel expenses – employee’s annual salary $138,790 or less

Table 7: Reasonable amounts for overseas travel expenses – employee’s annual salary $138,791 to $247,020

Table 8: Reasonable amounts for overseas travel expenses – employee’s annual salary $247,021 or more

Allowances for 2022-23

The full document in PDF format: 2022-23 Determination TD 2022/10 (pdf).

The 2022-23 reasonable amount for overtime meal expenses is $33.25.

Reasonable amounts given for meals for employee truck drivers are as follows:

• breakfast $26.80
• lunch $30.60
• dinner $52.75

2022-23 Domestic Travel

Table 1: Salary $133,450 and below

Table 2: Salary $133,451 to $237,520

Table 3: Salary $237,521 and above

2022-23 Overseas Travel

Table 6: Salary $133,450 and below

Table 7: Salary – $133,451 to $237,520

Table 8: Salary – $237,521 and above

Table 1: Reasonable amounts for domestic travel expenses – employee’s annual salary $133,450 and below

Table 2: Reasonable amounts for domestic travel expenses – employee’s annual salary $133,451 to $237,520

Table 3: Reasonable amounts for domestic travel expenses – employee’s annual salary $237,521 and above

Table 4: Reasonable amounts for domestic travel expenses – high-cost country centres accommodation expenses

Table 5a: Reasonable amounts for domestic travel expenses – employee truck driver’s meals (food and drink)

Table 6: Reasonable amounts for overseas travel expenses – employee’s annual salary $133,450 and below

Table 7: Reasonable amounts for overseas travel expenses – employee’s annual salary $133,451 to $237,520

Table 8: Reasonable amounts for overseas travel expenses – employee’s annual salary $237,521 and above

Allowances for 2021-22

The full document in PDF format: 2021-22 Determination TD 2021/6 (pdf).

The document displayed with links to each sections is set out below.

For the 2021-22 income year the reasonable amount for overtime meal expenses is $32.50

2021-22 Domestic Travel

Table 1: Salary $129,250 and below

Table 2: Salary $129,251 to $230,050

Table 3: Salary $230,051 and above

2021-22 Overseas Travel

Table 6: Salary $129,250 and below

Table 7: Salary – $129,251 to $230,050

Table 8: Salary – $230,051 and above

2021-22 Domestic Table 1: Employee’s annual salary – $129,250 and below

2021-22 Domestic Table 2: Employee’s annual salary – $129,251 to $230,050

2021-22 Domestic Table 3: Employee’s annual salary – $230,051 and above

2021-22 Domestic Table 4: High cost country centres – accommodation expenses

2021-22 Domestic Table 5: Tier 2 country centres

2021-22 Domestic Table 5a: Employee truck driver’s meals (food and drink)

2021-22 Overseas Table 6: Employee’s annual salary – $129,250 and below

2021-22 Overseas Table 7: Employee’s annual salary – $129,251 to $230,050

2021-22 Overseas Table 8: Employee’s annual salary – $230,051 and above

2021-22 Overseas Table 9: Table of countries

Allowances for 2020-21

Download full document in PDF format: 2020-21 Determination TD 2020/5 (pdf).

The document displayed with links to each section is set out below.

For the 2020-21 income year the reasonable amount for overtime meal expenses is $31.95 .

2020-21 Domestic Travel

Table 1: Salary $126,970 and below

Table 2: Salary $126,971 to $225,980

Table 3: Salary $225,981 and above

2020-21 Overseas Travel

Table 6: Salary $126,970 and below

Table 7: Salary – $126,971 to $225,980

Table 8: Salary – $225,981 and above

2020-21 Domestic Travel 2020-21 Domestic Table 1: Employee’s annual salary – $126,970 and below

2020-21 Domestic Table 2: Employee’s annual salary – $126,971 to $225,980

2020-21 Domestic Table 3: Employee’s annual salary – $225,981 and above

2020-21 Domestic Table 4: High cost country centres – accommodation expenses

2020-21 Domestic Table 5: Tier 2 country centres

2020-21 Domestic Table 5a: Employee truck driver’s meals (food and drink)

2020-21 Overseas Travel 2020-21 Overseas Table 6: Employee’s annual salary – $126,970 and below

2020-21 Overseas Table 7: Employee’s annual salary – $126,971 to $225,980

2020-21 Overseas Table 8: Employee’s annual salary – $225,981 and above

2020-21 Overseas Table 9: Table of countries

Allowances for 2019-20

The determination in sections:

Domestic Travel

Table 1: Employee’s annual salary – $124,480 and below

Table 2: Employee’s annual salary – $124,481 to $221,550

Table 3: Employee’s annual salary – $221,551 and above

Table 4: High cost country centres – accommodation expenses

Table 5a: Employee truck driver’s meals (food and drink)

Overseas Travel

Table 6: Employee’s annual salary – $124,480 and below

Table 7: Employee’s annual salary – $124,481 to $221,550

Table 8: Employee’s annual salary – $221,551 and above

For the 2019-20 income year the reasonable amount for overtime meal expenses is $31.25.

The reasonable travel and overtime meal allowance expense amounts commencing 1 July 2019 for the 2019-20 income year are contained in Tax Determination TD 2019/11 (issued 3 July 2019).

Download the PDF or view online here .

Domestic Travel Table 1: Employee’s annual salary – $124,480 and below

Domestic Travel Table 2: Employee’s annual salary – $124,481 to $221,550

Domestic Travel Table 3: Employee’s annual salary – $221,551 and above

Domestic Travel Table 4: High cost country centres – accommodation expenses

Domestic Travel Table 5: Tier 2 country centres

Domestic Travel Table 5a: Employee truck driver’s meals (food and drink)

Overseas Travel Table 6: Employee’s annual salary – $124,480 and below

Overseas Travel Table 7: Employee’s annual salary – $124,481 to $221,550

Overseas Travel Table 8: Employee’s annual salary – $221,551 and above

Overseas Travel Table 9: Table of countries

Substantiation and Compliance

Taxation Ruling TR 2004/6 explains the the way in which the expenses can be claimed within the substantiation rules, including the requirement to obtain written evidence and exemptions to that requirement.

Allowances which are ‘reasonable’ , i.e. comply with the Reasonable Allowance determination amounts and with TR 2004/6 are not required to be declared as income and are excluded from the expense substantiation requirements.

These substantiation rules only apply to employees. Non-employees must fully substantiate their travel expense claims. Expenses for non-working accompanying spouses are excluded.

Key points :

To be claimable as a tax deduction, and to be excluded from the expense substantiation requirements, travel and overtime meal allowances must:

• be for work-related purposes; and
• be supported by payments connected to the relevant expense
• for travel allowance expenses, the employee must sleep away from home
• if the amount claimed is more than the ‘reasonable’ amount set out in the Tax Determination, then the whole claim must be substantiated
• employees can be required to verify the facts relied upon to claim a tax deduction and/or the exclusion from the substantiation requirements
• an allowance conforming to the guidelines doesn’t need to be declared as income or claimed in the employee’s tax return, unless it has been itemised on the statement of earnings. Amounts of genuine reasonable allowances provided to employees(excludng overseas accommodation) are not required to be subjected to tax withholdings or itemised on an employee’s statement of earnings.
• claims which don’t match the amount of the allowance need to be declared.

The Tax Office has issued guidance on their position.

[11 August 2021] Taxation Ruling TR 2021/4 reviews the tax treatment of accommodation and food and drink expenses, and provides 14 examples which distinguish non-deductible living expenses from deductible travelling on work expenses. FBT implications for the ‘otherwise deductible’ rule and travel and LAFHA allowances are also considered.

[11 August 2021] Practical Compliance Guideline PCG 2021/3 (which finalises draft PCG 2021/D1 ) provides the ATO’s compliance approach to determining if allowances or benefits provided to an employee are travelling on work, or living at a location.

For FBT purposes an employee is deemed to be travelling on work if they are away for no more than 21 consecutive days, and fewer than 90 days in the same work location in a FBT year.

See also: Travel between home and work and LAFHA Living Away From Home

The issue of annual determination TD 2017/19 for the 2017-18 year marked a tightening of the Tax Office’s interpretation of the necessary conditions for the relief of allowances from the substantiation rules, which would otherwise require full documentary evidence (e.g. receipts) and travel records. (900-50(1))

For a full discussion of the issues, this article from Bantacs is recommended: Reasonable Allowance Concessions Effectively Abolished By The ATO .

Prior to 2017-18

In summary: Prior to 2017-18 the Tax Office rulings stated the general position that provided a travel allowance was ‘reasonable’ (i.e. followed the ATO-determined amounts) then substantiation with written evidence was not required. “In appropriate cases”, however employees may have been required to show how their claim was calculated and that the expense was actually incurred.

What changed

The relevant wording was changed in the 2017-18 determination to now require that more specific additional evidence be available if requested. This additional evidence is not prescribed in the tax rules, but represents a higher administrative standard being applied by the Tax Office.

The required evidence includes being able to show:

• you spent the money on work duties (e.g. away from home overnight for work)
• how the claim was worked out (e.g. diary record)
• you spent the money yourself (e.g. credit card statement, banking records)
• you were not reimbursed (e.g. letter from employer)

Other requirements highlighted by the Bantacs article include:

• a representative sample of receipts may be required to show that a reasonable allowance (or part of it) has actually been spent (TD 2017/19 para 20)
• hostels or caravan parks are not considered eligible for the accommodation component of a reasonable allowance because they are not the right kind of “commercial establishment”, examples of which are hotels, motels and serviced apartments (para 14)
• reasonable amounts for meals can only be for meals within the specific hours of travel (not days), and can only be for breakfast, lunch or dinner (para 15), and therefore could exclude, for example, meals taken during a period of night work.

Tip : The reasonable amount for incidentals still applies in full to each day of travel covered by the allowance, without the need to apportion for any part day travel on the first and last day. (para 16).

Alternative: business travel expense claims

With the burden of proof on ‘reasonable allowance’ claims potentially quite high, an alternative is to opt for a travel expense claim made out under the general substantiation rules for employees, or under the general rules for deductibility for businesses.

The kind of business travel expenses referred to here could include:

Airfares Accommodation Meals Car hire Incidentals (e.g. taxi fares)

The Tax Office has an article describing how to meet the requirements for claiming travel expenses as a tax deduction. See: Claiming a tax deduction for business travel expenses

Travel diary

A travel diary is required by sole traders and partners for overnight expenses and recommended for everyone else (including companies and trusts).

It is important to exclude any private portion of travelling expense which is non-deductible, or if paid on behalf of an employee gives rise to an FBT liability.

For example the expenses of a non-business associate (e.g. spouse), the cost of private activities such as sight-seeing, and accommodation and associated expenses for the non-business portion of a trip.

Airfares to and from a business travel destination would not need to be apportioned if the private element of the trip such as sightseeing was only incidental to the main purpose and time spent.

This is an example of a travel diary for Rebecca who owns a business as a sole trader landscape gardener. (courtesy of ATO Tax Time Fact Sheet )

Allowances for 2018-19

For the 2018-19 income year the reasonable amount for overtime meal allowance expenses is $30.60 .

The meal-by-meal amounts for employee long distance truck drivers are $24.70, $28.15 and $48.60 per day for breakfast, lunch and dinner respectively.

This determination includes ATO reasonable allowances for

(a) overtime meal expenses – for food and drink when working overtime (b) domestic travel expenses – for accommodation, food and drink, and incidentals when travelling away from home overnight for work (particular reasonable amounts are given for employee truck drivers, office holders covered by the Remuneration Tribunal and Federal Members of Parliament) (c) overseas travel expenses – for food and drink, and incidentals when travelling overseas for work

Allowances for 2017-18

An addendum was issued modifying paragraphs 23 to 30 of determination TD 2017/19 setting out the new reasonable amounts, and consolidated into TD 2017/19 as linked above. For reference purposes, the first-released version of TD 2017/19 issued 3 July 2017 is linked here .

2017-18 Addendum: ATO reinstates the meal-by-meal approach for truck drivers’ travel expense claims

On 27 October 2017 the ATO announced the reinstatement of the meal-by-meal approach for truck drivers who claim domestic travel expenses for meals. The following new reasonable amounts have now been included in an updated version of the current ruling (see on page 7)：

For the 2017-18 income year the reasonable amount for overtime meal allowance expenses is $30.05 .

This determination contains ATO reasonable allowances for:

• overtime meals
• domestic travel
• employee truck drivers
• overseas travel
• $24.25 for breakfast
• $27.65 for lunch
• $47.70 for dinner

The amount for each meal is separate and can’t be combined into a single daily amount or moved from one meal to another.

See: ATO media release

Allowances for 2016-17

For the 2016-17 income year the reasonable amount for overtime meal allowance expenses is $29.40 .

Allowances for 2015-16

Download the PDF or view online here . For the 2015-16 income year the reasonable amount for overtime meal allowance expenses is $ 28.80 .

Allowances for 2014-15

Allowances for 2013-14

The reasonable travel and overtime meal allowance expense amounts for the 2013-14 income year are contained in Tax Determination TD 2013/16 . For the 2013-14 income year the reasonable amount for overtime meal allowance expenses is $ 27.70 .

Allowances for 2012-13

The reasonable travel and overtime meal allowance expense amounts for the 2012-13 income year are contained in Tax Determination TD 2012/17 . For the 2012-13 income year the reasonable amount for overtime meal allowance expenses is $27.10

Allowances for 2011-12

The reasonable travel and overtime meal allowance expense amounts for the 2011-12 income year are contained in Tax Determination TD 2011/017 . For the 2011-12 income year the reasonable amount for overtime meal allowance expenses is $26.45

This page was last modified 2023-06-28

New ATO Guidance on travel, accommodation and meal expenses

The ATO have been busy with new guidance on travel, accommodation and meal expenses releasing the updated version of the Tax Rulling for employee transport costs, and a draft ruling and PCG (Practical Compliance Guideline) on accommodation and meal expenses.

Deductions for employee transport expenses

As a general comment, the principles outlined in the ATO ruling are also relevant in relation to the otherwise deductible rule for FBT purposes and may also have some relevance for individuals operating a business as a sole trader or through a partnership.

The general principle in this area is that travel between home and a regular work location is not deductible. On the other hand, travel to an alternative place of work or between workplaces can be deductible. There are several broad exceptions that should also be considered.

The finalised ruling provides that clients and practitioners need to focus on the reason for the travel in determining the deductibility of the expenses, indicating that there are two key considerations:

• The obligation to travel should arise in connection with the employment and not as a result of a personal choice of the employee; and

• The travel must be relevant to the demands of the work and a necessary consequence of those activities.

Other relevant factors indicating travel could be deductible include the employer requesting the travel to be undertaken, the travel occurs on work time and the travel occurs when the employee is under the direction and control of the employer.

The ATO appears particularly concerned with situations where taxpayers travel to distant work locations and where this is due mainly to a choice that they have made. For example, the employee might have chosen to accept a job that is a significant distance from their home and they have chosen not to relocate their home. Likewise, an employee might have chosen to perform most of their work from home, even though the employer would have provided them with an office or other place to perform their work. The ATO indicates that travel in these circumstances is not generally deductible. However, if it can be shown that the primary reason for the travel is due to the employee’s work duties rather than a choice made by the employee then deductions might be available.

Other general positions confirmed by the ATO in the ruling include:

• FIFO workers are not generally able to claim deductions in respect of travel from their home to a point of departure for their worksite (e.g., between home and the location at which they fly out to a mine etc);

• There is only limited scope to claim deductions in respect of travel undertaken while an employee is ‘on-call’ although this is possible in some situations.

Deductions for accommodation and meal expenses

The ATO confirms that accommodation and meal expenses are normally private in nature, however where employees travel overnight in the course of their employment it can be possible to claim deductions for those costs.

However, where the employee is considered to be living away from home or relocating the costs should not be deductible.

The ruling states that the following factors would suggest that the employee is living away from home rather than merely travelling in the course of their work:

• There is a change in the employee’s regular place of work;

• The length of the overall period the employee will be away from their usual residence is a relatively long one;

• The nature of the accommodation is such that it becomes their usual residence;

• The employee is, or can be, accompanied by family or visited by family and friends.

The ruling indicates that the reason for the expenses being incurred needs to be the employee’s work activities rather than any choice made by the employee in order to be deductible. That is, the treatment of expenses on accommodation and meals will often match the treatment of transport costs associated that trip.

In addition to the updated draft ruling the ATO has issued a practical compliance guideline which sets out the ATO’s approach to determining whether employees are travelling for work or living away from home. Very broadly, the guideline provides that the ATO will accept that an employee is travelling for work when all of the following are satisfied by the employee (there are also requirements for the employer that must be met):

• They are away from their normal residence for work purposes;

• They do not work on a fly-in fly-out or drivein drive-out basis;

• They are away for no more than 21 days at a time continuously, and an overall total period of fewer than 90 in the same work location in an FBT year; and

• They must return to their normal residence when their period away ends.

If you have any questions in regards to your own circumstances and any deductions for travel, meals or accommodation please give us a call and we will be delighted to asssit you through this complex area.

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Tax Tips – What Travel Expenses Can I Claim On Tax?

by Camden Professionals | Oct 3, 2023 | Income Tax Returns , Small Business , Small Business Tips , Tax Deductions | 0 comments

Did you know that you may be able to claim tax expenses for certain travel costs if your job requires you to stay away from home overnight? The good news is that accommodation expenses, meals, and other incidental costs can potentially be tax deductible when traveling for work.

However, your trip must require an overnight stay away from your regular residence. Commuting costs or daily trips where you return home each night do not qualify.

So when can you consider travel away from home for tax purposes? Here are a few examples:

• If your regular workplace does not change, but your job necessitates multi-day trips like visiting clients in another city.
• During short work trips, as long as you stay in temporary lodging such as a hotel rather than commuting back daily.
• If you cannot reasonably have family or friends visit you during work travel.

On the other hand, expenses are generally not deductible if:

• Your home is already a long commute from your regular workplace.
• You choose to live in a location solely for personal reasons and commute long-term.
• You elect to sleep near your workplace rather than returning home each night

What travel expenses can I claim on tax?

Some expenses the Australian Taxation Office (ATO) allows as travel tax deductions include accommodation, meals, and transportation. For accommodation, you can claim things like hotel rooms, apartments, or even campground fees if you’re staying overnight somewhere for work. You’re also able to claim any food or drinks you purchase while traveling on a business trip.

Minor incidental costs related to your trip like parking, public transportation, or internet charges at your lodging can qualify. Transportation costs to and from your destination are also claimable tax deductions. Things like plane, train, or bus tickets all count. Just be sure to keep your receipts to back up your claims.

It’s possible to claim expenses for housing you rent or own when traveling away from work temporarily. This only applies if the accommodation costs are reasonable compared to commercial lodging for the trip duration. Expenses must also be divided proportionately if the property is used both personally and professionally. Unfortunately, choosing to live farther from your job does not make housing an allowable work expense. While maintaining a home separate from your workplace is a personal decision, the tax rules are intended to reimburse travel costs rather than support a residential choice.

What travel expenses can’t I claim on tax?

There are a few situations where out-of-pocket costs incurred while traveling for work may not be eligible deductions. For example, if your employer provides accommodation or meals during your trips, those expenses would not be claimable since you did not pay for them yourself.

Additionally, if the company or a third party reimburses you for any travel costs after the fact, those amounts have already been covered.

Living far from your workplace or job site is considered a personal circumstance rather than a business expense. Choosing to sleep near the office rather than returning home between shifts is seen as a personal decision rather than a business necessity.

If you’ve moved to a new city or area for an extended period to be closer to your workplace, you likely wouldn’t be able to claim costs like meals, housing, or other daily costs. Some signs that suggest you’re truly living somewhere rather than just temporarily working there include a long-term change in where your job is located, staying in a more permanent housing situation like an apartment, and having the ability to have family or friends visit you where you’re residing.

When to claim or not to claim on tax

If your job requires you to travel overnight away from your home, those costs could potentially be deductible. For example, let’s say your work involves meeting with clients in another state, requiring an overnight stay. In that situation, expenses like airfare, lodging, and meals while you’re traveling would normally qualify for a deduction.

Relocation costs for a new job also do not qualify.

Tax Tip:  If you travel away from home for 6 or more nights in a row, you need to keep travel records such as a travel diary. This is in addition to keeping receipts for your expenses.

Travel diary for tax purposes

You’ll need to keep a travel diary to show your workings of private versus business activities. If you travel within Australia and meet eligibility requirements for record keeping exemption or are an airline travel crew you won’t need to keep a travel diary.

You can keep an electronic or paper diary, but either way, you’ll need to include details on your location, what you were doing, the date and start and end times of your activities.

Apportion expenses when you claim your expenses.

When traveling for both work and personal reasons, it’s important to properly allocate expenses between the two. Only work-related costs are tax deductible, so accurately apportioning is necessary.

For example, if you add a holiday time to the end of a business trip, only the costs for the business portion can be claimed. The same applies if family or friends join you while traveling overnight for work – you need to determine the work-specific expenses.

Even if attending a work event while on a personal holiday, apportionment is required. However, if the private aspect is incidental to an overnight work trip, full costs may still be deductible.

The key is properly separating expenses incurred for work versus personal purposes. Taking care with documentation and record keeping helps ensure deductible amounts are correctly identified if ever reviewed.

Three golden rules for claiming tax deductions

The Australian Taxation Office (ATO) has three main ‘golden rules’ for claiming work-related expenses:

• You must have spent the money yourself and weren’t reimbursed. This ensures expenses aren’t claimed multiple times.
• The expense must directly relate to earning your income. There must be a clear connection between the expense and your job.
• You must have a record to prove it. You need documentation like receipts or invoices to substantiate any claims made if the ATO requests them for audit purposes.

How can we help?

If you have any questions or would like further information, please feel free to give our office on 08 9221 5522 or via email – [email protected]   or arrange a time for a meeting so we can discuss your requirements in more detail.

General Advice Warning

The material on this page and on this website has been prepared for general information purposes only and not as specific advice to any particular person. Any advice contained on this page and on this website is General Advice and does not take into account any person’s particular investment objectives, financial situation and particular needs.

Before making an investment decision based on this advice you should consider, with or without the assistance of a securities adviser, whether it is appropriate to your particular investment needs, objectives and financial circumstances. In addition, the examples provided on this page and on this website are for illustrative purposes only.

Although every effort has been made to verify the accuracy of the information contained on this page and on this website, Camden Professionals, its officers, representatives, employees, and agents disclaim all liability [except for any liability which by law cannot be excluded), for any error, inaccuracy in, or omission from the information contained in this website or any loss or damage suffered by any person directly or indirectly through relying on this information.

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Travel agent employee expenses T–W

Last updated 23 June 2023

Details on claiming common employee travel agent expenses for:

Taxi, ride-share, public transport and car hire

Tools and equipment, travel expenses, travel insurance, union and professional association fees, working from home expenses.

You can claim a deduction for transport costs if you travel in the course of performing your work. For example, taking a taxi from your regular workplace to another work location.

You can’t claim a deduction for travel expenses between home and work, these are private expenses.

You can't claim a deduction if your employer reimburses you for these expenses.

You can claim a deduction for tools and equipment if you use them to perform your duties as an employee travel agent.

You can only claim a deduction for the work-related use of the item.

If the tool or equipment cost you $300 or less, you can claim a deduction for the full amount in the year you buy it, if:

• you use it mainly for work purposes
• it's not part of a set that together cost more than $300.

You can claim a deduction for the cost over the life of the item (that is, decline in value), if the tool or equipment:

• cost more than $300
• is part of a set that together cost more than $300.

If you bought the tool or item of equipment part way through the year, you can only claim a deduction for the decline in value for the period of the income year that you own it. To work out your deduction use the Depreciation and capital allowances tool .

You can also claim a deduction for the cost of repairs to tools and equipment that you use for work purposes.

You can’t claim a deduction for tools and equipment that your employer or a third party supplies for use.

Example: equipment for a work-related purpose – deductible

Megan is a travel agent and spends a large part of her working day at her desk. Megan’s employer supplies staff with electronic sit-stand workstations to reduce the impact of sitting all day.

Megan buys an anti-fatigue sit-stand mat for $60 that her employer doesn’t provide or reimburse her for. Megan can claim an immediate deduction for the cost of the mat as it cost less than $300.

Megan takes a photo of the receipt and records the expense in the myDeductions tool in the ATO app.

You can claim a deduction for travel expenses you incur when your work requires you to:

• travel for work
• sleep away from your home overnight in the course of performing your income producing activities.

Expenses you can claim include your accommodation, meals and expenses which are incidental to the travel (incidentals). You can't claim a deduction for accommodation where you don't incur any expenses, because:

• you slept in accommodation your employer provides
• you eat meals your employer provides
• your employer or a third-party reimburses you for any costs you incur.

You can't claim a deduction for travel expenses related to personal holidays, even if they are discounted by your employer. You can't claim a deduction for taking a friend or family member with you on work travel.

Receiving an allowance from your employer doesn’t automatically mean you can claim a deduction. In all cases, you must be able to show:

• you were away overnight
• you have spent the money
• the travel directly relates to earning your employment income
• how you work out your claim.

If you receive a travel allowance you must include it as assessable income in your tax return unless all of the following apply:

• the travel allowance is not on your income statement or payment summary
• the travel allowance doesn't exceed the Commissioner's reasonable amount
• you spent the whole allowance on deductible accommodation, meal and incidental expenses (if applicable).

The Commissioner's reasonable amount is set each year. The amount is used to determine whether an exception from keeping written evidence applies for the following expenses which are covered by a travel allowance:

• accommodation
• incidentals.

You don’t have to keep written evidence such as receipts if both the following apply:

• you receive a travel allowance from your employer for the expenses
• your deduction is less than the Commissioner’s reasonable amount.

If you claim a deduction for more than the Commissioner’s reasonable amount you need to keep receipts for all expenses, not just for the amount over the Commissioner’s reasonable amount.

Even if you are not required to keep written evidence such as receipts, you must be able to explain your claim and show you spent the amounts. For example, show your work diary, that you received and correctly declared your travel allowance and bank statements.

Example: work-related travel with private travel component

Eleanor is a travel agent. Her employer holds an annual conference each year for all branches to attend. This year the conference is interstate and Eleanor’s employer pays for the cost of her flights and accommodation to attend. During the conference all meals are provided.

Eleanor decides to extend her stay and have a holiday. Eleanor can't claim a deduction for any of the expenses she incurs as she didn't pay for the work-related conference expenses and the costs to extend her stay are private.

For more information, see TD 2022/10 Income tax: what are the reasonable travel and overtime meal allowance expense amounts for the 2022-23 income year?

You can't claim a deduction for travel insurance even if your travel is work-related. Travel insurance is a private expense because policies cover items of a private nature, such as illness, loss of baggage and theft.

You can claim a deduction for union and professional association fees you pay. You can use your income statement as evidence of the amount you pay if it's shown on there.

You may be able to claim a deduction for working from home expenses you incur as an employee. These can be additional running expenses such as electricity, the decline in value of equipment or furniture, phone and internet expenses. You must:

• use one of the methods set out by us to calculate your deduction
• keep the records required for the method you choose.

There are some expenses you can't claim a deduction for as an employee. Employees who work at home can't claim costs:

• for coffee, tea, milk and other general household items your employer may provide you at work
• setting them up for online learning
• teaching them at home
• buying equipment such as iPads and desks
• your employer pays for or reimburses you for the expense
• for the decline in value of items provided by your employer – for example, a laptop or a phone.
• Generally, as an employee, you can’t claim occupancy expenses (rent, rates, mortgage interest and house insurance premiums), unless your home office is your only place of work because no other work location is provided by your employer
• exclusively or almost exclusively used for work purposes.

You can’t claim a deduction if your employer paid for your home office to be set up or reimburses you for the expenses.

Use the Home office expenses calculator to help you work out the amount you can claim as a deduction.

For more information, see:

• PS LA 2001/6 Verification approaches for home office and electronic device expenses
• TR 93/30 Income tax: deductions for home office expenses
• PCG 2023/1 Claiming a deduction for additional running expenses incurred while working from home - ATO compliance approach

For more employee travel agent expenses, see

• Travel agent employee expenses A–G
• Travel agent employee expenses H–P
• Travel agent employee expenses R–S

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