work related travel expenses ato 2023

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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Work Related Travel Expenses and Deductions

If you are required to travel as part of your job, then you likely incur various costs. Whether making a short trip to attend a meeting or taking an overseas trip for an extended period, you can deduct your travel expenses. However, the laws surrounding travel expenses are complicated, and the Australia Taxation Office (ATO) keeps close tabs on travel expenses. So, it’s vital to pay close attention to what you claim to avoid mistakes. 

What is work-related travel expenses

Work-related travel expenses are expenses incurred while travelling for work. If you incur any expenses related to work-related travel, such as accommodation or meals, you may be able to claim them as travel expenses on your tax return.

Using your car for work 

If your job requires you to use a personal vehicle, you are entitled to deduct the motoring costs you incur while completing your job. This does not generally include the commute you make from your home to your place of work. 

Eligibility

However, there are limited circumstances   that may allow it. For example,

• An employee travelling between work sites throughout the day can claim their commute. 
• If you travel directly from one job to a second job, as long as you do not return home in between. 
• If you are travelling to a course or meeting for work, you can deduct expenses. 

Methods to calculate work-related travel expenses

There are two options when it comes to vehicle travel for work tax deductions. 

• As of April 2023, there is a flat rate of  78 cents  per kilometre, and you can claim up to  5,000 km . You will need to keep a log of your travel to determine how far you travel for work purposes. 
• Use a logbook if you travel and detail your running expenses, from mileage to fuel, servicing, repairs, insurance, and depreciation. If you use the logbook method, your logbook needs to show your work-related trips for a minimum continuous period of 12 weeks

Alternatively, you can use a reputable tax software that will provide you with  mileage auto-tracking  and a simple snap and store for all of the receipts related to your business expenses. 

Ensure you maintain your logbook for a minimum of  12 weeks  before relying on it for your income tax return. The log should include odometer readings to determine the proportion of time you use it for work purposes. Store all receipts and invoices noting your spending on your vehicle so that you can claim the correct percentage of vehicle expenses. 

Travel to and from work is considered a private expenditure unless your employer requires you to transport bulky equipment and vehicles. That being said, the ATO pays close attention to these types of claims and may disallow them. 

Other work-related transport expenses in Australia

There are other expenses that can also be claimed for work-related travel if they are for:

• Heavy vehicles and utes if they have a carrying capacity of more than one tonne
• Vans with a carrying capacity of 9 or more passengers
• Fees for hiring or renting a car
• Costs incurred while driving someone else’s vehicle for work purposes, such as fuel expenses
• Public transportation fares, including air, bus, train, tram, ferry, taxi, ride-share or ride-sourcing fares
• Expenses associated with work-related transport expenses such as bridge tolls, road tolls, and car parking fees

Other travel expenses 

You can claim additional work-related travel expenses for costs you incur that your employer doesn’t reimburse. These travel expenses must be work-related rather than your daily commute to and from work. 

• Airfare and taxi fares
• Tunnel or bridge tolls
• Car parking
• The cost of public transport

If you are fined for a motoring offence, whether it is for parking, speeding or otherwise, you cannot claim these. 

Overnight meals & accommodation 

If you are travelling away from home, you can claim accommodation, meals and entertainment. You cannot claim meal expenses if your employer reimburses you or provides you with a full allowance for these expenses. A number of businesses will provide an allowance, expenses included, so the employee doesn’t need to cover the costs. You may be taxed for those allowances, in which case a deduction is possible for costs incurred. 

The ATO provides a lengthy list of what is viewed as a reasonable spend on accommodation, meals, and incidental expenses. You won’t need to produce detailed records with receipts or invoices if you claim below the specified ATO allowance. If you exceed the reasonable amounts as laid out by the ATO, or you don’t receive an allowance, then you need to keep detailed records to show your spending wasn’t extravagant. 

The ATO established a reasonable amount to highlight when detailed records must be kept. Many people would assume that they can claim this maximum amount, but we don’t recommend you do this. You must only claim the amount of money you spent. 

Even if you claim below the reasonable amount, you should be able to prove the expenses you incurred. A bank or credit card statement is viewed as sufficient evidence should the need arise. It will help support your claim that you were in the particular area at the time you claimed. 

As long as your travel includes an overnight stay, you can claim business meals, food and beverages. You can’t claim meals when you work from home. You could claim tax travel expenses if you always work from home and need to travel to an office. 

What you can’t claim

Travel for personal reasons or between your home and your workplace can’t be claimed Examples include:

• Travel between your home and regular place of work or vice versa
• Travel for personal reasons, like running errands on the way to or from work
• Travel for overtime or out-of-hours work
• Travel from your home (which is also your place of work for one job) to another location where you work for someone else

Other situations that allow you to claim travel deductions 

You may be able to claim work-related travel expenses tax if you attend a work conference or course. If it is local, you can claim transport or mileage. If it’s interstate or overseas, you can claim accommodation, airfares and meals. 

In all cases, your best bet is to visit a tax agent to ensure your travel deductions are above board. 

Maximise your tax refund with QuickBooks

Are you tired of manually tracking your business mileage and keeping track of receipts for tax purposes? Look no further than QuickBooks tax software! With our advanced mileage auto-tracking feature, you can effortlessly keep track of the kilometres you drive for business purposes. Plus, our simple snap and store function allows you to easily capture and organise all of your business expense receipts in one place, making tax season a breeze.

Source: Quickbooks

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About 5 million Aussies claim work from home expenses but this tax time there are new rules

Almost 5 million Australians claimed work from home expenses last financial year, but the ATO has changed the methods you can use to claim tax deductions this tax time. 

"We've got two methods now in which you can claim your working from home expenses," says ATO Assistant Commissioner Tim Loh.

"We've got the actual cost method — you need to be able to portion out the private expense versus the work-related expense [and] that method requires really significant records — and the fixed-rate method."

It comes as a survey of more than 1,000 Australians from Finder finds that one in eight Australians say their tax refund is "critical" to their financial health and that 36 per cent plan to put their return into savings.

The research shows around one in seven Australians (15 per cent) say they will be withdrawing their refund to pay for household bills, while 5 per cent say they will be putting it towards their mortgage.

How the 'actual cost' method works

Here you can claim each expense you have for working from home separately.

But you need to apportion what's private and what's work-related.

You can claim separately for:

• the decline in value of depreciating assets – for example, home office furniture (desk, chair) and furnishings, phones and computers, laptops or similar devices.
• electricity and gas (energy expenses) for heating, cooling and lighting
• home and mobile phone, data and internet expenses
• stationery and computer consumables, such as printer ink and paper
• cleaning your dedicated home office.

The other method that is available is the 67 cents per hour revised fixed rate method.

How the 'fixed rate' method works

The method to claim 67 cents for each hour you work from home doesn't require you to apportion expenses between private and work.

But it also restricts you from claiming each expense item separately. It assumes all your expenses were at that rate and takes in:

• home and mobile internet or data expenses
• mobile and home phone usage expenses
• stationery and computer consumables, such as printer ink and paper.

"In prior years, you actually had to have a dedicated workspace in order to use that method, [such as] a home office, whereas now what we're saying is, we know millions of Australians work from the kitchen bench or the dining table or even the couch," Mr Loh says.

"It's really easy to use. [All] you need to do is work out the number of hours you work from home, multiply that by 67 cents per hour. And that's your deduction for your working from home expenses."

Will using the new ATO method result in a lower tax deduction?

Tax agents have previously warned that the 67 cents per hour method could result in a lower tax deduction .

Mr Loh says it's really going to depend on people's facts and circumstances and it's up to each individual what method they opt for.

Either way, he reminds taxpayers to keep good records.

"What we're saying to people is this: if you are using the 67 cents per hour, revised fixed rate method, all those types of costs are already included, so you don't need to proportion for the private expense," he says.

"But if you want to use the actual cost method, you still need to make sure that you're apportioning for the private expense."

Car-related travel claims under watch

Each year, almost 9 million Australians claim about $22 billion worth of work-related expenses, many relating to working from home.

The average claim last financial year was about $2,500.

"We see a lot of people make mistakes when it comes to work-related expenses," Mr Loh says.

Car expenses, including the number of kilometres travelled claimed as well as the purchase cost of the car (depreciation) and fuel costs, are a massive area of claims — almost $7 billion related to car expenses was claimed last financial year.

"All we're saying to people is this: you can't claim your private expenses when it comes to your car and travel expenses," Mr Loh says.

Investors with rental properties under focus again

In 2021-22, 1.7 million individual investors claimed tax deductions that resulted in an average net rental gain of almost $2,000, up from $751 the year before.

Mr Loh says nine in 10 rental property investors get their tax return wrong.

"We are seeing people make a lot of mistakes when it comes to their interest deductions in particular," he says.

"We do see people refinancing their loans and then using the refinancing amounts for private expenses like to buy Tesla or go on a holiday with their friends. And what we're saying to people is that interest needs to be apportioned for the private expense."

And people not declaring income from renting out their homes on places like Airbnb is also under focus.

"What we're saying to people was this: you know, when you do end up selling your property, typically that isn't subject to capital gains tax, but when you do rent out a room, there are capital gains tax consequences that come out of selling your property in the future."

More than 1 million Australians trading in cryptocurrencies 

More than 1 million Australians bought or sold cryptocurrencies in 2021-22.

The ATO says since March 2020, the agency has displayed an informative pre-filled message in their myTax and tax agent portals.

It says this information has been provided in the tax returns for around 928,000 individuals in 2020-21 and over 979,000 individuals in 2021-22, to help them report correctly.

"It's a growing area where people want to invest in," Mr Loh says.

"What we're reminding taxpayers is if you sell, swap or exchange cryptocurrency there are capital gains tax consequences that arise from those transactions."

End of the low and middle income tax offset

The low and middle income tax offset (LMITO), ended on June 30, 2022. This means it doesn't apply for the 2022–23 income year.

This offset delivered up to $1,500 in tax rebates per person last financial year and helped anyone making less than $126,000 annually.

It could cost households up to $3,000 if two adults were collecting the tax cut, which is a big amount given many people are counting on their tax return to meet cost of living increases.

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Track mileage automatically

Ato mileage reimbursement guide, in this article, mileage reimbursement rules, for employees, for sole traders, how to calculate the percentage of business-related driving, keeping compliant logs for your reimbursement.

Welcome to our ATO guide to mileage and deductions in Australia.  

With Driversnote you can create and share your vehicle log book with the ATO or your employer with ease. Try the automated logbook app for free. 

Depending on your employment situation, there are different methods you can receive compensation for your business driving. Read on to see what methods apply to you and how to choose the best one.

Firstly, there are general rules set by the ATO that you need to be aware of.

The ATO cents per km rate

The cents per km rate is set each year by the ATO. The newly confirmed rate for the 2023/2024 tax year is $0.85 per business-related kilometre . Learn more about the new cents per km 2023/2024 rate .

The rate is meant to cover all expenses of owning and running your vehicle for the business portion of its use.

Find the 2022/2023 cents per km rate if you will be claiming your business travel.

Eligible vehicles

The ATO defines a car eligible for mileage reimbursement as a motor vehicle (excluding motorcycles and similar vehicles) designed to carry a load of less than one tonne and less than nine passengers. You might be able to receive reimbursement for your business-related driving with vehicles that don’t fall within the above definition. Read on based on your situation to find out how.

Work-related travel

The ATO defines work-related driving that you can be reimbursed for. Some examples include:

• Attending meetings or conferences away from your usual workplace
• Collecting supplies or delivering items
• Travel directly between two separate places of employment (for example, if you have a second job)
• Travelling from your usual workplace or home to an alternative workplace (for example, a client’s office or worksite)
• If your work can be classed as “itinerant work” – for example, if your job regularly requires you to work at more than one location each day before going home

Commuting from home to work is generally not claimable, but there are some limited exceptions.

As an employee in Australia, you might receive a car allowance from your employer for work-related car expenses, or you might be reimbursed on a cents per kilometre basis by your employer for those expenses.

While your employer decides on the scheme they use for reimbursing your work-related car expenses, there are general rules set by the ATO that have to be considered.

If you own or lease the vehicle you drive for business, there are two common options of reimbursement (depending on which your employer prefers).

Vehicle types

Your employer can select a reimbursement scheme no matter the type of vehicle you drive for work. However, if you deduct your motor vehicle expenses, you need to be aware that the ATO has different rules for cars and other motor vehicles. Read more about deducting work-related car expenses .

Cents per km

Your employer can use the ATO mileage rate for business travel instead of having you record all of your actual expenses. This way, you log your business-related kilometres and the only extra expenses you might need to record are things like parking costs and road tolls, rather than every cost associated with owning and driving your car.

As long as your total reimbursement amounts to that year’s ATO cents per km or less, your reimbursement is not taxed as income.

Use the calculator below to quickly work out your cents per km reimbursement.

What does the cents per km cover?

The cents per kilometre rate is meant to cover all costs you've incurred driving your vehicle for business purposes. These include fixed costs such as road tax, insurance and depreciation, and variable costs such as fuel, maintenance and repairs and tyres.

Car allowance

Your employer might offer you a car allowance - it is an allowance meant to cover the need for a company car. You can use the ATO car allowance to purchase a car or maintain your current one.

An ATO car allowance is paid upfront, and the amount is set by your employer. This allowance is considered a benefit, is to be paid towards your salary and taxed accordingly.

Note that the car allowance is not meant to replace reimbursement for your work-related car expenses. You will still be able to claim these on your annual tax return.

Check our car expenses for employees  guide to learn more about the differences between a car allowance and a cents per km reimbursement.

If your employer doesn’t provide a reimbursement scheme

In case your employer doesn’t reimburse you at the cents per km rate for business-related travel expenses, even if they provide a car allowance, you will be able to claim deductions from the ATO.

Kilometre tracking made easy

Trusted by millions of drivers

As a self-employed individual who has work-related car expenses, you can claim a deduction on your annual tax return.

There are three methods of calculating your claim for tax deduction purposes:

• The cents per kilometre method

The logbook method

• The actual costs method

The ATO cents per km method

The simplest method of claiming business-related driving is by using the ATO cents per km rate set by the ATO each year. All you have to do is keep track of the kilometres you drive throughout the year, and multiply them by the corresponding year’s cents per km rate. Keep in mind you can claim up to 5000 km per year with this method.

With the logbook method, you can claim your business travel expenses without any upper limit in kilometres, so long as they are business related. However, it requires more involvement than the simple cents per km method. This method can only be used by sole traders or partnerships claiming deduction for a car. To work out the amount you can claim, you need to:

• Keep a logbook of all journeys
• Work out the percentage of business use for your car
• Keep track of your total work-related car expenses for the year

You can keep a logbook for 12 consecutive weeks and use it as proof of your business driving for five years, so long as your driving doesn't change much.

Then, you claim the percentage of expenses that corresponds to the percentage of kilometres throughout the year you've driven for business purposes.

The actual expense method

The actual expenses method can be used by companies and trusts, or sole traders and partnerships claiming business-related kilometres for vehicles other than a car.

To use this method, you need to keep receipts of all expenses for your vehicle and the annual number of kilometres you drive, same as with the Logbook method. However, you need to always keep an accurate logbook of your driving at all times to record your actual driving.

Learn more about each of the methods in our dedicated guide for sole traders .

If you drive your car for both business and private purposes, you need to work out the percentage of use that is for business, employees and sole traders alike.

To work out the business use in per cent, use the following calculation:

Let’s say you have driven a total of 6000 kilometres, 4500 of which are work-related. Divide the business kilometres by the total number of kilometres driven, then multiply by 100 4500 business km / 6000 total km = 0,75 0,75 x 100 = 75% In this example, the car was driven for business purposes 75% of the time

You generally need to be able to show how you have worked out your business driving and the reimbursement or deduction you should receive. However, the logs you need to keep depend on your situation.

As an employee, your employer will define the details you need to log for your driving. This will depend on the method you are reimbursed at, and the records your employer needs for bookkeeping.

As a sole trader, it will again depend on the method you use for deducting work-related car expenses.

• If you use the cents per km method, you don’t need to keep logs but you have to be able to show how you’ve worked out your business use and deduction should the ATO require it.
• If you use the logbook method you will have to note down your driving quite extensively, including each trip you take, purpose, date, odometer readings at the start and end of each trip and keep receipts for all vehicle expenses. See our dedicated log book requirements for tax to find out everything you need to record in your logbook.
• The actual expense method requires you to also keep track of all driven kilometres and all receipts related to your car expenses.

Finally, remember to keep your logs and receipts for 5 years.

Not located in Australia? Check out our other guides here:

- Mileage guide for the US  (IRS mileage guide) -  Mileage guide for Canada (CRA mileage guide) - Mileage guide for the UK  (HMRC mileage guide) - Mileage guide for Denmark   - Mileage guide for Sweden

How to automate your mileage logbook

ATO Mileage Guide

• For Self-Employed
• For Employees
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• The Cents per Kilometre Method
• ATO Log Book Requirements
• Claim Car Expenses In 5 Simple Steps
• Calculate Your Car Expenses Reimbursement
• ATO Car Expenses Deductions
• Is Mileage Reimbursement Taxed?
• Historic Cents Per KM Rates
• ATO Cents Per KM Rate 2021/2022
• ATO Cents Per KM Rate 2020/2021

Automate your logbook

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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

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Understanding business travel deductions

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IRS Tax Tip 2023-15, February 7, 2023

Whether someone travels for work once a year or once a month, figuring out travel expense tax write-offs might seem confusing. The IRS has information to help all business travelers properly claim these valuable deductions.

Here are some tax details all business travelers should know

Business travel deductions are available when employees must travel away from their  tax home  or  main place of work  for business reasons. A taxpayer is traveling away from home if they are away for longer than an ordinary day's work and they need to sleep to meet the demands of their work while away.

Travel expenses  must be ordinary and necessary. They can't be lavish, extravagant or for personal purposes.

Employers can deduct travel expenses paid or incurred during a  temporary work assignment  if the assignment length does not exceed one year.

Travel expenses for  conventions  are deductible if attendance benefits the business. There are special rules for conventions held  outside North America .

Deductible travel expenses include:

• Travel by airplane, train, bus or car between your home and your business destination.
• Fares for taxis or other types of transportation between an airport or train station and a hotel, or from a hotel to a work location.
• Shipping of baggage and sample or display material between regular and temporary work locations.
• Using a personally owned car for business.
• Lodging and  meals .
• Dry cleaning and laundry.
• Business calls and communication.
• Tips paid for services related to any of these expenses.
• Other similar ordinary and necessary expenses related to the business travel.

Self-employed individuals or farmers with travel deductions

• Those who are self-employed can deduct travel expenses on  Schedule C (Form 1040), Profit or Loss From Business (Sole Proprietorship) .
• Farmers can use  Schedule F (Form 1040), Profit or Loss From Farming .

Travel deductions for the National Guard or military reserves

National Guard or military reserve servicemembers can claim a deduction for unreimbursed travel expenses paid during the  performance of their duty .

Recordkeeping

Well-organized records  make it easier to prepare a tax return. Keep records such as receipts, canceled checks and other documents that support a deduction.

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