If you’re blending your work and leisure trips aka ‘bleisure‘ travel, it pays to know what you can and can’t claim on your annual taxes. With the Australian Tax Office focusing on work-related expenses, here’s what you need to know before filing your tax return.
Corporate Traveller said the ATO’s 2024 focus is particularly relevant for bleisure travellers with flight bookings showing Aussie business travellers spend double the global average time on business trips, averaging six nights compared to the worldwide average of 3.5.
It’s important as any work-related expense must be directly connected with the business earning an income.
Bleisure travel is very popular with Aussies and attending a conference with additional sightseeing is a good example of this trend.
Corporate Traveller and Flight Centre Travel Group’s Moneywise Global have teamed up to share their top five tax season tips for bleisure travellers.
1. Bleisure travellers! Keep track of work expenses while on holiday
If you’re mixing business with pleasure, keep scanned copies and summaries of your expenses in a travel and expense diary. Moneywise Global General Manager John Tuohy said noting dates, times, durations and places of work-related activities in your calendar will often suffice as a ‘travel diary’ for tax purposes and substantiate deductions for specific and associated expenses.
“In cases where leisure travel is ‘incidental’ to a business trip, more trip expenses, such as accommodation and meals, will be allowable as deductions.”
2. Weekend stays can be deductible when business extends from Friday to Monday
Incidental and reasonable travel deductions can include Saturday and Sunday accommodation when necessary for business requirements on a Friday and the following Monday.
Tuohy warned: “Taking a partner or family on these trips would incur expenses that are clearly private, such as additional accommodation, meal and entertainment expenses. Don’t be tempted to claim these on your tax.”
3. Include legitimate client entertainment expenses…
But only if the real purpose is business. Want to take your client golfing while on a bleisure trip? You can claim it, says Tuohy, but only if the purpose of the expense is income-generating business-related.
“Discussing business between parties, a project or negotiating a business outcome is more likely to be deductible. These cases would likely be covered by the employer and reimbursed and more relevant to business owners than employees.”
4. That’s a no-go on claiming daily travel
Apart from work-related km deductions in your personal vehicle, claiming public transport, parking, tolls, taxi/rideshare, flights, meals and other incidental expenses that aren’t reimbursed by your employer are only tax deductible when associated with an overnight work trip for bleisure travellers.
5. Don’t be tempted to double-dip on travel work claims
Tuohy said most out-of-pocket work expenses will be reimbursed by your employer or the business, so avoid the temptation to double-dip and attract ATO attention. However, you can claim daily travel allowances (per diems) and mileage travelled in your own car for work in your tax deduction entitlement.
Corporate Traveller Global Managing Director Tom Walley added: “Keeping on top of your documentation should be a priority for every business traveller. This proactive approach will help you manage your tax obligations while travelling and ensure you are compliant with Australian tax laws.”
