Travel

Work-Related Travel Expenses: A Comprehensive Guide for Employees

Have you incurred travel expenses while performing your duties as an employee? If so, you may be eligible to claim deductions for these work-related expenses. This guide will provide you with all the necessary information to navigate the process seamlessly.

Things to Know

To claim a deduction for a work-related expense, keep these key points in mind:

  • You must have personally paid for the expense and not have been reimbursed.
  • The expense must be directly related to earning your income.
  • You need to maintain records as evidence of the expense, usually in the form of receipts.

If the expense was for both work and private purposes, you can only claim a deduction for the work-related portion. Additionally, if your total claim for work-related expenses exceeds $300, you must provide written evidence to support your claims.

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Work-Related Travel Expenses

Work-related travel expenses encompass various categories, such as:

  • Public transport, air travel, and taxi fares
  • Short-term car hire
  • Meal, accommodation, and incidental expenses incurred during overnight work trips
  • Actual expenses for traveling in a car owned or leased by someone else, including petrol, repairs, and maintenance costs
  • Bridge and road tolls, as well as parking fees for cars, motorcycles, and vehicles with a carrying capacity of one tonne or more, or nine or more passengers
  • Expenses for motorcycles and vehicles with a carrying capacity of one tonne or more, or nine or more passengers, such as utility trucks and panel vans.

You Can Claim

You can claim the cost of trips undertaken while performing your work duties. This includes trips between your home and workplace under the following circumstances:

  • If you had to carry bulky tools or equipment essential for your employment duties and could not leave them at your workplace.
  • If your home served as a base of employment, requiring you to start your work at home and travel to a workplace for the same employer.
  • If you regularly worked at more than one site each day before returning home.

Work-related travel expenses also cover trips between separate places of employment when you have a second job, provided one of those places is not your home. Furthermore, it includes travel from your normal workplace or home to an alternative workplace that is not a regular workplace, such as a client’s premises, while you are on duty. Similarly, it covers travel from an alternative workplace back to your normal workplace or directly home.

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In cases where the travel was partly private, you can only claim the work-related portion of the expenses. If you received an award transport payment from your employer, you can claim a deduction for work-related transport expenses covered by these payments.

To claim meal, accommodation, and incidental expenses incurred during overnight work trips, the following conditions must apply:

  • You were required to travel as part of your work duties.
  • You were working away from home for a relatively short period or periods of time, rather than living away from home.
  • The expenses did not arise from a choice you made about where to live.
  • You have a permanent home located away from the work location to which you are traveling.
  • You personally paid for the expenses and were not reimbursed.

FAQs

Q: What evidence do I need to claim meal, accommodation, and incidental expenses incurred during overnight work trips?

A: You need to maintain records of these expenses, including receipts, to support your claim. Ensure that you retain these records for five years from the date you lodge your tax return.

Q: Can I claim expenses for operating a car provided by my employer?

A: If your employer provided a car exclusively for your use (including under a salary sacrifice arrangement) but you or your relatives were entitled to use it for non-work purposes, you cannot claim a deduction for work-related expenses for operating the car. However, you can claim expenses for a work-related use of the car, such as parking and bridge or road tolls.

Q: What should I do if I no longer own or use an item costing over $300 that I previously claimed a deduction for?

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A: If you no longer own or use an item that you previously claimed a deduction for, such as a utility truck or van with a carrying capacity of a tonne or more, you may need to make a balancing adjustment. Contact the Australian Taxation Office (ATO) for further guidance in such cases.

Conclusion

Understanding and claiming work-related travel expenses can be a complex process. However, armed with this guide and the relevant information, you can confidently navigate the system. Ensure that you keep proper records and follow the instructions provided by the ATO to maximize your deductions.

For more detailed information about claiming deductions for work-related expenses, visit iBlog.

FAQs

Q: What evidence do I need to claim meal, accommodation, and incidental expenses incurred during overnight work trips?

A: You need to maintain records of these expenses, including receipts, to support your claim. Ensure that you retain these records for five years from the date you lodge your tax return.

Q: Can I claim expenses for operating a car provided by my employer?

A: If your employer provided a car exclusively for your use (including under a salary sacrifice arrangement) but you or your relatives were entitled to use it for non-work purposes, you cannot claim a deduction for work-related expenses for operating the car. However, you can claim expenses for a work-related use of the car, such as parking and bridge or road tolls.

Q: What should I do if I no longer own or use an item costing over $300 that I previously claimed a deduction for?

A: If you no longer own or use an item that you previously claimed a deduction for, such as a utility truck or van with a carrying capacity of a tonne or more, you may need to make a balancing adjustment. Contact the Australian Taxation Office (ATO) for further guidance in such cases.

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Conclusion

Understanding and claiming work-related travel expenses can be a complex process. However, armed with this guide and the relevant information, you can confidently navigate the system. Ensure that you keep proper records and follow the instructions provided by the ATO to maximize your deductions.

For more detailed information about claiming deductions for work-related expenses, visit iBlog.

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