Taxation Determination TD 2017/19 –
- • 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 (particular reasonable amounts are given for employee truck drivers, office holders covered by the Remuneration Tribunal and federal members of parliament), and
- • overseas travel expenses — for food and drink, and incidentals when travelling overseas for work.
Reasonable amount for overtime meal expenses
5. Samantha works for the local government. She is asked to work overtime one night to complete an urgent task. Samantha works her 8 hour day followed by 4 hours of overtime. Samantha receives an overtime meal allowance of $14.98 pursuant to her agreement which is shown on her payment summary. During the overtime Samantha takes a rest break to get a meal and returns to continue her overtime. Samantha spends $20 on her meal.
6. Because Samantha has spent less than the reasonable amount for overtime meal expenses, she can claim a deduction for the $20 she spends and she is not required to substantiate the expenditure (for example, get and keep the receipt for the meal).
7. If Samantha’s tax return is checked by the ATO she may be asked to explain her claim for deduction. To do this, Samantha would show that she worked overtime, that she was paid an overtime meal allowance under an industrial instrument, that she correctly declared this allowance as income in her tax return, and that she costed her meal at $20 based on the cost of the curry and drink she purchased from a nearby Thai restaurant.
9. If Samantha’s overtime meal allowance was not shown on her payment summary and she fully spent the allowance, she can choose to leave it out of her tax return and not claim a deduction for the meal she purchases when working overtime.
Reasonable amount for domestic travel expenses for employee truck drivers
23. Employee truck drivers who do not receive a travel allowance and truck drivers who are owner-drivers must substantiate all travel expenses with written evidence (refer to paragraphs 76 to 80 of TR 2004/6).
24. For the 2017-18 income year the reasonable amount for travel expenses (excluding accommodation) of employee truck drivers who have received a travel allowance and who are required to sleep (take their major rest break) away from home is $55.30 per day.
25. Employee truck drivers who receive a travel allowance and spend less than the reasonable amount on food and drink they consume while travelling do not have to keep detailed written evidence of expenditure (for example, all of the receipts). On review or audit, employee truck drivers will be required to show how they calculated the amount they claimed, including evidence that they travelled for work on the relevant days and were required to sleep or take their major rest break away from home. They will also be required to show that they received a travel allowance for the relevant days, and correctly returned this allowance as income in their tax return.
28. Kevin is required to travel regularly from Melbourne to Adelaide and sleep away from home in his truck cab, then return home to Melbourne the next day. Kevin is paid a travel allowance of $40 per day for such trips. Kevin’s usual pattern is to stop and eat four times at road houses over the two days. Kevin usually has a meal, a coffee and buys a drink for the road, and spends between $25 and $40 for each meal. In the 2017-18 income year, Kevin’s records show that he made this trip 100 times, received an allowance of $8,000, and spent $14,000 on food and drink he consumed when travelling.
29. When completing his tax return, Kevin must correctly declare the travel allowance as income in his tax return. Because Kevin calculated that he spent more than the reasonable amount on food and drink when travelling, he has 2 choices, as follows:
- Kevin can claim $14,000 as a travel expense if he got and kept all of his receipts for the food and drink he purchased and consumed when travelling; or
- Kevin can rely on the reasonable amount and claim $11,060 ($55.30 x 200 days) as a travel expense. If Kevin relies on the reasonable amount and his tax return is checked by the ATO, Kevin will be asked to show he travelled this route 100 times, that he received a travel allowance from his employer for the 200 days that he was required to travel, that he correctly declared this allowance as income in his tax return and that he typically spent $55 or more a day on food and drink when making this trip (for example, by reference to diary entries, bank records and receipts that he kept for some of the trips).
30. If Kevin’s travel allowance was not shown on his payment summary and he fully spent the allowance, he can choose to leave it out of his tax return and not claim any deductions for the meals and drinks he buys when travelling from Melbourne to Adelaide.