Claiming deductions for business travel expenses

You can claim tax deductions for expenses related to business travel provided you follow the ATO’s rules.

Eligibility requirements
You must fulfil certain eligibility requirements for your tax deduction claims to be valid. You can only claim a tax deduction if you:

• Travel once your business has already started
• Keep records and documentation to provide evidence for your claim

Record keeping rules
The ATO has strict recordkeeping rules to ensure deductions are accurate. For one or more nights away from home ensure you keep documents like:

• Boarding passes
• Booking confirmations
• Receipts

For travellers spending six or more consecutive nights away from home, a travel diary or similar document must be kept. You must record the detail of each business activity before your travel ends, or as soon as possible afterwards. You must log:

• The nature of the activity
• The day and approximate time the business activity began
• How long the business activity lasted
• The name of the place where you engaged in the business activity

Business and private travel rules
Many travellers may integrate a holiday into their business trip. If you operate your business as a company or trust, fringe benefits tax may apply if the employee travel includes private activity paid for by the employer. For sole traders, exclude the private expenses from your claim.