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  • Quarantine and testing expenses when travelling on work

    You can claim a deduction for accommodation, food, drink and incidental expenses you incur if you're travelling on work during COVID-19 and must quarantine.

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    When you can claim

    Expenses for accommodation, food and drink are normally private in nature and not deductible by employees. However, you can claim a deduction for accommodation, food, drink and incidental expenses you incur if you're 'travelling on work' during COVID-19 and must quarantine.

    You can also claim the expenses you incur if you need to take a COVID-19 test when you travel overnight for work. For example, a Polymerase Chain Reaction (PCR) test or rapid antigen test (RAT).

    Travelling on work means that you need to travel to perform your employment duties and must sleep away from your home overnight.

    Quarantine expenses

    If you must quarantine either during or after a trip while travelling on work, this would be an extension of the work-related trip. As such you undertake the quarantine as part of your employment duties.

    If you are not travelling on work, your quarantine expenses are private in nature. No deduction is available for private quarantine expenses.

    You also can't claim a deduction for quarantine expenses you incur when you either:

    • travel to or from a work location and need to quarantine
    • need to quarantine for another purpose (for example, returning from a private holiday), even if you can work from the quarantine location.

    The fact you were working or are able to work from a quarantine location, doesn't meet the definition of 'travelling on work'.

    If you incur expenses for both work purposes and private purposes, you will need to apportion your expenses. You can only claim the expenses that relate to your work activities.

    Example: travelling on work

    Mai was travelling on work for a sales tour of Victoria for 3 weeks. On her return to Sydney, Mai must quarantine for 2 weeks in a hotel.

    As Mai is only travelling for work duties, she can claim a deduction for costs she incurs while in quarantine for her:

    • accommodation
    • food and drinks
    • incidental expenses.
    End of example

     

    Example: expenses not connected with work-holiday travel

    Rojesh lives and works in Brisbane, he travels to Sydney for a holiday for 2 weeks. Sydney was designated a COVID-19 hotspot during his trip. As such, when he returns to Brisbane, he must quarantine for 2 weeks in a hotel and can't return to work. He pays for his accommodation, food and drink expenses during this two-week period.

    While Rojesh is in quarantine he is able to work using his laptop and keep normal business hours. Even though he is working while in quarantine, Rojesh can't claim a deduction for his accommodation, food and drink expenses.

    His expenses are private in nature as his travel was not for work purposes.

    End of example

     

    Example: returning from overseas working holiday

    Phillip takes a year of his long service leave so that he can live and work in the UK for that period. When his leave comes to an end, he returns to Adelaide.

    When he arrives in Adelaide, he must quarantine for a 2 week period in a hotel. While he is in quarantine, Phillip works for his Australian employer using his laptop.

    As Phillip is returning to live in Australia, the expenses he incurs while in quarantine are not as a result of travelling on work. Therefore, his quarantine expenses are private in nature and he can't claim a deduction.

    End of example

    For information about records you need, see Keeping travel expense records and Travel allowance record keeping exceptions.

    COVID-19 testing expenses

    You may require a COVID-19 test by the destination jurisdiction in order for you to:

    • enter the overseas country or state
    • return to Australia or your home state.

    Travel expenses include incidental expenses which are minor, but necessary expenses that relate to your travel for work. The cost of a COVID-19 test is an incidental expense when the travel is in the course of your employment. The cost of the COVID-19 test is a deductible expense.

    If you do not have to pay for the COVID-19 test or your costs are reimbursed, you can't claim a deduction

    If your travel is for both work and private purposes, you may need to apportion your expenses.

    Example: travel expenses are deductible

    Therese is employed as the State manager of a company that operates clothing stores. Each year, the State managers attend an 8 day overseas trip to Italy to have meetings with buyers and distributors. Therese decides to attend the meetings.

    Before entry into Italy and return to Australia, Therese buys 2 COVID-19 tests as she will need proof of a negative COVID-19 test taken within the last 3 days. Therese has receipts for the expenses.

    As the travel is in the course of Therese’s employment, the cost she incurs on the COVID-19 tests is in the course of performing her income-producing activities. As such, Therese is travelling on work during the 8 day period and can claim a deduction for the cost of the COVID-19 tests.

    End of example
    Last modified: 01 Apr 2022QC 64188