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  • Record keeping

    You need to get and keep records of your expenses for which you want to claim deductions. This is usually a receipt but can be another form of written evidence (such as an invoice).

    Records can be electronic (for example, you can take a photo of your receipt, or use an app).

    The myDeductions tool in the ATO app can help you to keep track of your work-related expenses. It’s an easy way to capture information on the go, making tax time quicker by uploading your deductions to your tax return.

    Records must show what you purchased, when, where and how much you spent. They must be in English.

    Example: written evidence

    Amy is an intern pharmacist. Amy pays her professional association fees but does not get a receipt. She has a letter from the organisation showing the amount due and payable and a credit card statement that shows she paid the organisation the same amount for 'professional fees' a few days later.

    The combination of documents is sufficient written evidence of her deduction for professional fees.

    End of example

     

    Example: insufficient records

    Neville is an apprentice welder. Neville buys some tools from a hardware store but he does not keep the receipt. He pays with cash that he withdrew from an ATM that day.

    While Neville has bank records that show he made the withdrawal and the date the withdrawal was made, the bank statements do not show:

    • the name of the hardware store
    • the nature of the goods purchased
    • the cost of the tools he purchased.

    Neville's records are insufficient written evidence and no deduction for the tools purchased would be allowed.

    If Neville had a credit card statement instead of bank records, he still wouldn't have sufficient written evidence. Although his credit card statement shows the name of the hardware store and the amount of the tools purchased, it does not show the nature of the goods purchased.

    End of example

    There are a few exceptions to this rule:

    Small expense receipts

    You don’t have to get and keep a receipt for work-related expenses that are $10 or less, as long as your total claim for small expenses is $200 or less.

    If you don’t get a receipt for small expenses you can still claim a deduction as long as you make a record of the small expenses. For example, you can make a record by writing in your work diary.

    Your record should show what you purchased, when, where, and how much you spent. It must be in English. You can use this to show how you calculated your deduction if we request this information from you.

    Example: record of small expenses

    Donna is trainee computer technician. During the income year, Donna purchased 15 USB flash drives to use at work. Each of the USB flash drives cost less than $10. As the total cost of the USB flash drives Donna buys during the year is less than $200 in total, Donna makes a record of the purchases in her electronic work diary setting out:

    • the item she purchased
    • the date of purchase
    • the cost of the item
    • where she purchased the item from.

    Donna's electronic diary records are sufficient written evidence of the purchase of her USB flash drives so she would be able to claim a deduction for them.

    End of example

    Hard to get receipts

    If you can’t get a receipt for a work-related expense, you can still claim a deduction as long as you make a record. For example, you can make a record by writing in your work diary.

    Your record should show what you purchased, when, where, and how much you spent. It must be in English. You can use this to show how you calculated your deduction if we request this information from you.

    Example: record of hard to get receipts

    Trevor is a trainee truck driver. Occasionally Trevor rides with a trainer on a long distance trip which requires him to sleep away from home overnight. Trevor's roster shows when he is away overnight. On these occasions, Trevor takes a shower at a roadhouse which caters for truck drivers. The showers are coin operated so Trevor can't get receipts for them.

    Trevor makes a record of when he took a shower, where he took the shower and how much the shower cost. His record and his roster which shows he had to travel overnight for work will be sufficient written evidence of the cost Trevor incurred on showers so he can claim a deduction for them.

    End of example

    Overtime meal expense receipts

    You can claim a deduction for your overtime meal expenses (food and drink) without keeping all your receipts if you:

    • undertake overtime
    • receive an overtime meal allowance paid under an industrial law or award
    • spent money on meals (food and drink) you consumed during your overtime meal break
    • are not claiming more than the reasonable amount we set – see apprentices and trainees' Overtime meal expenses.

    Even if you aren't required to get and keep receipts for your overtime meal expenses, we may check your tax return and ask you to show how you calculated your claim. If we ask, you will need to provide documents that show:

    • when you did overtime
    • you purchased a meal
    • you correctly declared the overtime meal allowance as income in your tax return.

    If you don’t receive an overtime meal allowance paid under an industrial law or an award or are claiming a deduction for more than the reasonable amount, you need to get and keep your receipts for your overtime meal expenses.

    You claim what you actually spent, not the reasonable amount.

    Example: overtime meal expense less than reasonable amount

    Raisa works as a paralegal in a law firm. She is asked to work overtime one night to complete an urgent task. Raisa receives an overtime meal allowance of $15.94 pursuant to her industrial award, which is shown on her income statement and included in her income tax return.

    During the course of performing the overtime duty, Raisa takes a rest break to have a meal and returns to continue her overtime. Raisa spends $20 on her meal. The reasonable amount for overtime meal expenses for the relevant income year is $32.50.

    Raisa can claim a deduction of $20 without keeping receipts because she:

    • worked overtime
    • spent $20 on a meal which she consumed during her overtime meal break
    • received an overtime meal allowance paid under industrial award
    • included the overtime meal allowance in her tax return
    • is not claiming more than the reasonable amount.

    Although she is not required to keep written evidence, Raisa will still need to:

    • show how she calculated her total deduction at the end of the income year

    show that she included the overtime meal allowance in her income tax return.

    End of example

    For more information, see TD 2020/5 Income tax: what are the reasonable travel and overtime meal allowance expense amounts for the 2020-21 income year?

    Travel and meal expense receipts

    You can claim a deduction for your accommodation, meal (food and drink) and incidental expenses without keeping all your receipts if your travel is for less than six nights and you:

    • receive a travel allowance that is expected to cover your accommodation, meals and incidental expenses when travelling (a token amount you receive as a travel allowance isn't accepted as covering such costs)
    • are required to travel for work and sleep away from home overnight
    • spent money on accommodation, meals (food and drink) and incidental expenses while travelling away from home overnight for work
    • are not claiming more than the reasonable amount set – see Apprentices and trainees' Travel expenses.

    If you travel overseas, you have to keep receipts for your accommodation expenses regardless of whether you meet all of the above points.

    Even if you aren't required to get and keep receipts for your accommodation, meals and incidental expenses when travelling for work, we may check your tax return and ask you to show how you calculated your claim. If we ask, you will need to provide documents that show:

    • when you were travelling for work (including start and finish times)
    • you paid for accommodation and purchased meals and incidentals and the amount you spent
    • you correctly declared the travel allowance as income in your tax return.

    The records you need to keep for accommodation, food, drink and incidentals depend on the length of your trip and if it is domestic or international and whether you travel is wholly for work purposes.

    If you travel for six or more nights in a row, you may need to keep a travel diary in which you record the dates, places, times and duration of your activities and travel.

    You don’t need to keep a travel diary if your travel away from home is less than six nights in a row. If you are required to maintain and keep records, the records you keep may include:

    • income statement, payment summary or payslips to show the travel allowances you received
    • a travel diary, or documents that show the days you travelled for work, including      
      • start and finish times
      • where you travelled
      • when you stopped for meals
       
    • all receipts, invoices or documents for accommodation, meals and incidentals showing the      
      • name of the supplier
      • amount you spent
      • nature of the good or service
      • date you spent the money
      • creation date of the receipt or other written evidence
       
    • written evidence, such as a bank statement, to show that you were the one who spent the money.

    You claim what you actually spent, not the reasonable amount.

    For more information, refer to TD 2020/5 Income tax: what are the reasonable travel and overtime meal allowance expense amounts for the 2020-21 income year?

    Example: allowance and expenses incurred less than reasonable amountJim is a trainee software developer. His employer requires him to attend some specialist training interstate. The training is for 3 days. Jim travels interstate the night before the training commences and travels back home on the third day of the training. He arrives home at 9.00pm that evening.

    Jim receives an allowance of $495 to cover his accommodation and meals while he is travelling. The allowance is included on his income statement at the end of the income year.

    While he is interstate for the training, Jim stays in accommodation which cost him $110 per night and spends around $23 for breakfast, $19 for lunch and $35 for dinner each day. At the airport on his way home, Jim spends $21 on his dinner. These amounts are less than the reasonable amounts for the interstate location he travelled to.

    At the end of the year, Jim declares the allowance of $495 received from his employer as income in his tax return and claims a deduction of $582 which he has calculated as follows:

    Accommodation $110 × 3 nights = $330

    Four dinners ($35 × 3) + $21 = $126

    Three breakfasts $23 × 3 = $69

    Three lunches $19 × 3 = $57

    Total amount spent: $330 + $126 + $69 + $57 = $582

    Jim can claim his deduction of $582 for accommodation and meals without keeping written evidence because he:

    • travelled overnight for work purposes
    • spent money on accommodation and meals while he was travelling
    • was paid a travel allowance by his employer which was capable of meeting his expected costs while he was travelling for work
    • included the travel allowance in his tax return
    • is not claiming more than the reasonable amount.

    Although Jim does not have to keep written evidence of his expenses, he may be asked to show how he calculated his claim.

    End of example

    Find out about apprentices and trainee deductions'

      Last modified: 03 Feb 2022QC 67770