Can I claim tax deduction for my travel expenses? Yes but only if travel expenses you incur that are directly related to your work.
There are specific record-keeping requirements for travel expenses, depending on whether your travel allowance is shown on your payment summary, whether your travel was domestic or overseas, the length of your travel and your occupation.
In this article we will cover following travel expenses tax deduction questions:
- Example of eligibility to claim travel expenses as a tax deduction?
- When you cannot claim travel expenses as a tax deduction?
- How to prove your travel expenses?
- How to claim travel expenses if you have received allowances?
1. Example of eligibility to claim travel expenses as a tax deduction?
- Directly between two separate workplaces - for example, when you have a second job
- From your normal workplace to an alternative workplace (for example, a client's premises) while still on duty, and back to your normal workplace or directly home
- If your home was a base of employment - you started your work at home and travelled to a workplace to continue your work for the same employer
- If you had shifting places of employment - you regularly work at more than one site each day before returning home
- From your home to an alternative workplace for work purposes, and then to your normal workplace or directly home. This does not apply where the alternative workplace has become a regular workplace
- If you needed to carry bulky tools or equipment you used for work and couldn't leave them at your workplace - for example, an extension ladder or a cello.
2. When you cannot claim travel expenses as a tax deduction?
- You do minor work-related tasks - for example, picking up the mail on the way to work or home
- You have to drive between your home and your workplace more than once a day
- You are on call - for example, you are on stand-by duty and your employer contacts you at home to come into work
- There is no public transport near where you work
- You work outside normal business hours - for example, shift work or overtime
- Your home was a place where you ran your own business and you travelled directly to a place of work where you worked for somebody else
- You do some work at home.
3. How to prove your travel expenses?
The records you need to keep for travel expenses for fares, accommodation, food, drink and incidentals depend on the length of your trip and if it is domestic or international.
If you travel for six or more nights in a row, you may need to keep a travel diary in which you record the dates, places, times and duration of your activities and travel. The purpose of a travel diary is to allow accurate calculation of the employment-related and private elements of your trip. If the travel was partly private, you can claim only the work-related part.
4. How to claim travel expenses if you have received allowances?
If your travel allowance is shown on your payment summary and you want to make a claim against it, you must have written evidence for the whole of your claim, not just the excess over the reasonable amount.
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This information is intended as a guide. All actual detail and circumstances differ, refer to ATO website for current legislation. Please discuss your situation with Top Accountants at https://topaccountants.com.au/tax-return
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