The Do’s and Don’ts of claiming travel

Claiming travel in your tax return is one of the (many!) confusing parts of preparing your tax return. But you shouldn’t let that stop you from claiming what you are entitled to. So, let’s keep you off the Tax Office’s radar but maximise your deductions.

The first thing to remember is that travel between home and your workplace is not deductible.

At the other end of the spectrum, if your employer requires you to travel to a location other than your normal workplace (for example, to do training) you can claim the costs of travel. This could include an amount for mileage, public transport costs, taxis etc. You can also claim the associated costs such as parking and tolls.

However, in between there’s a whole great big area of grey! Let’s try and cast some light on these areas.

Travelling between your main job and a second one: YES.

Going to an alternative workplace and then home or back to your usual workplace: YES

Carrying bulky tools or equipment (eg a cello or extension ladder) your employer requires you to use for work: YES

Using your private vehicle to deliver items or collect supplies: YES

There is no public transport where you live: NO

You are on call: NO

You do minor work tasks on the way too/from work (eg collecting mail): NO

You have to go between work and home multiple times each day: NO

You work shift work or overtime: NO

You start working at home and then go to work: NO

Then we move on to more complicated situations such as travelling overnight for work – either within Australia or internationally. If your employer requires to travel to another location and stay overnight, you are able to claim any additional costs you incur. There are the obvious ones like fares, accommodation and meals. But you can also claim travel to and from the airport/train station. It doesn’t matter whether it’s by private vehicle, taxi or public transport. Any tolls and parking associated with the travel are also deductible. However there are a few areas where you can’t claim.

If your employer pays for the travel or reimburses you, the costs can’t be claimed.

If you extend the trip for personal reasons, the cost of travel must be apportioned to exclude the personal portion. This applies even if you travel for a full week and stay on for the weekend.

If you receive a travelling allowance, you must include the allowance in your return as income and claim the costs as a deduction.

What records do you need to maintain to ensure you don’t fall foul of the Tax Office?

Receipts, receipts, receipts! You MUST keep a record for any deduction you claim. That might be a receipt or a toll/public transport statement. The exception is when it is a small amounts (<$10) paid by cash for which it would be unreasonable to keep a receipt (for example a single train fare). These should be recorded in a diary or central place.

If you claim mileage, you must be able to establish how far you travelled (Google Maps is your friend!) and it must be your vehicle.

If you travel away from home for more than six consecutive nights, you will need to keep a travel diary which details what you did each day including start and end times; where you were; and what costs you incurred. It should be recorded at the time of undertaking the travel.

If you have reduced your claim because of personal use, you must be able to justify how it was done. For example, if you were away on Monday to Friday and decided to stay away for the weekend, you might claim 5/7ths of the overall cost.

Don’t let the complex rules put you off claiming what you’re entitled to. I’m more than happy to chat with you and offer a FREE 30 minute initial consultation. You can easily book online here and I look forward to helping you sort your finances!