Taxation Determination

TD 2026/4

Income tax: reasonable travel and overtime meal allowance expense amounts for the 2026-27 income year

• Please note that the PDF version is the authorised version of this ruling.

What this Determination is about

1. This Determination sets out the amounts that the Commissioner considers are reasonable (reasonable amounts) for the 2026–27 income year in respect of the substantiation exception for:

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reasonable overtime meal allowance expenses in section 900-60 of the Income Tax Assessment Act 1997 (ITAA 1997) – for food and drink when working overtime

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domestic travel allowance expenses in section 900-50 of the ITAA 1997 – 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

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overseas travel allowance expenses in section 900-55 of the ITAA 1997 – for food and drink, and incidentals when travelling overseas for work.

2. This Determination must be read together with Taxation Ruling TR 2004/6 Income tax: substantiation exception for reasonable travel and overtime meal allowance expenses, which explains how and when the substantiation exceptions listed at paragraph 1 of this Determination apply.

3. The substantiation exceptions in sections 900-60, 900-50 and 900-55 of the ITAA 1997 can only be used if:

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your meal allowance expenses or travel allowance expenses are deductible under a provision outside Division 900 of the ITAA 1997 (refer to paragraph 8 of TR 2004/6)

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you receive and declare in your tax return an allowance for the specific expenditure you are claiming. For example, you can rely on section 900-60 and are not required to substantiate the cost you incur to purchase a meal when working overtime if you receive an overtime meal allowance for that occurrence of overtime.

4. Meal allowance expenses or travel allowance expenses incurred for work-related purposes commonly qualify as a deduction under section 8-1 of the ITAA 1997.^[1] In those circumstances, before you can rely on the reasonable amounts in this Determination, you need to satisfy the rules for deductibility under section 8-1 of the ITAA 1997.^[2] This includes establishing that:

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you incurred the expenditure, and were not reimbursed

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it is directly related to earning your assessable income, and

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it is not private or domestic in nature.

5. If you have satisfied the rules for deductibility under section 8-1 of the ITAA 1997 or under a provision outside Division 900 of the ITAA 1997 in respect of the meal allowance expenses or travel allowance expenses and you claim:

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the reasonable amount or less, then an exception from substantiation will apply to you – you would not be expected to keep detailed records of the kind that would otherwise be required to meet the substantiation requirements

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more than the reasonable amount, then an exception from substantiation will not apply to you – you must fully substantiate your expenditure, not just the amount over the reasonable amount.

6. All further legislative references in this Determination are to the ITAA 1997, unless otherwise indicated.

Ruling

Amounts provided by certain providers are accepted as reasonable

7. The Commissioner will accept that the daily rates from certain providers such as Employment Conditions Abroad Limited (ECA) as a commercial provider, or the Australian Public Service Commission (APSC) as a provider by subscription to government agencies, are reasonable amounts for the purposes of claims referred to in paragraph 1 of this Determination made by employees.

8. In such cases, you remain obliged to demonstrate, if asked, that you:

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received and declared an allowance for the specific expenditure you are claiming (refer to paragraph 3 of this Determination), and

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satisfy the rules for deductibility under section 8-1 (refer to paragraphs 3 and 4 of this Determination).

Reasonable amount for overtime meal expenses

9. For the 2026–27 income year, the reasonable amount for overtime meal expenses is $40.

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Example 1 – calculation of reasonable amount for overtime meal expenses

10. 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 $25 pursuant to her agreement, which appears on her income statement. During the overtime, Samantha takes a rest break to get a meal and returns to continue her overtime. Samantha spends $30 on her meal.

11. As Samantha spends less than the reasonable amount for overtime meal expenses, she can claim a deduction for the $30 she spends and she is not required to substantiate the expenditure (for example, get and keep the receipt for the meal).

12. If we check Samantha's tax return, she may be asked to establish that she satisfies the rules for deductibility and has included the overtime meal allowance in her tax return. To do this, Samantha would need to show that she:

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worked overtime

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was paid an overtime meal allowance under an industrial instrument

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correctly declared this allowance as income in her tax return

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purchased and consumed food and drink during the period of overtime, and

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wasn't reimbursed by her employer for the cost of the meal she purchased.

13. To do this, Samantha could show her pay slip which includes her overtime allowance and a diary note that she made stating that she purchased a Pad Thai noodle bowl and a bottle of soft drink for $30 during the period of overtime. If applicable, she could also show a letter from her employer that states she was not reimbursed.

14. If Samantha spends more than the reasonable amount and wants to claim the higher amount she spends, she needs to get and keep the receipt for the meal. That is, she must substantiate the expenditure, as well as demonstrate deductibility.

15. If Samantha's overtime meal allowance is not shown on her income statement and she fully spends 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.

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Reasonable amounts for domestic travel expenses

16. The following reasonable amounts for domestic travel expenses do not apply to employee truck drivers^[3], office holders covered by the Remuneration Tribunal^[4] or federal members of parliament.^[5]

17. Reasonable amounts are provided in this Determination for 3 salary levels. Salary excludes any allowances received.

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Use Table 1 if your salary is $153,210 or less.

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Use Table 2 if your salary is between $153,211 and $272,680.

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Use Table 3 if your salary is $272,681 or more.

18. Part-time employees annualise their salary to a full-time equivalent salary level when determining which table to use for determining reasonable amounts under the substantiation exception. This ensures an equitable outcome for employees within the organisation.

19. Reasonable amounts are given for:

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accommodation at daily rates (for domestic travel only)

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meals (showing breakfast, lunch and dinner), and

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expenses incidental to travel.

20. These amounts are shown for the following travel destinations:

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each Australian state and territory capital city (see Tables 1 to 3 of this Determination)

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certain specified high-cost regional and country centres (see Table 4 of this Determination for individual amounts), and

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all other regional and country centres (a common amount is given for all locations not listed in Table 4 of this Determination).

21. The reasonable amount for accommodation applies only for short stays in commercial establishments like hotels, motels and serviced apartments. If a different type of accommodation is used (for example, a hostel or caravan park), the reasonable amount cannot be used even if you receive an allowance.

22. The reasonable amount for meals depends on the period and time of travel. That is, the reasonable amounts only apply to meals (that is, breakfast, lunch and dinner) that fall within the time of day from the commencement of your travel to the end of your travel that is covered by the allowance. For example, if you leave at 10:00 am on Monday and return home at 3:00 pm on Tuesday, you can apply the reasonable amounts for lunch and dinner on Monday and breakfast and lunch on Tuesday.

23. The reasonable amount for incidentals applies in full to each day of travel covered by the allowance, without the need to apportion for any part-day travel on the first and last day.

24. The reasonable amounts for domestic travel expenses, according to salary levels and destinations, for the 2026–27 income year, are shown in Tables 1 to 4 of this Determination.

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Example 2 – calculation of reasonable amount for meals and incidental expenses – domestic travel

25. Svetlana is an accountant earning $170,000 a year. As part of her duties, Svetlana travels to and from work in Sale for 4 days and 3 nights each month. Svetlana's employer pays for her accommodation directly and gives her a meal and incidental allowance of $140 per day for the 4 days of travel. This allowance is shown on her income statement. Svetlana's usual pattern is to eat 3 times a day, spending $30 on breakfast, $40 on lunch and $65 on dinner (that is, a total of $135 per day). Svetlana calculates the daily reasonable amount for meals and incidentals as follows:

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Table 2 of this Determination applies because Svetlana's salary is between $153,211 and $272,680.

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Sale is listed as a high-cost country centre in Table 4 of this Determination.

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Table 2 of this Determination provides reasonable amounts for high-cost country centres as $172.20 per day for meals and $36.30 per day for incidentals (that is, a total of $208.50 per day).

26. As Svetlana spends less than the reasonable amount on meals and nothing on incidentals, she can claim a deduction for the $135 per day that she spends on meals and she is not required to substantiate the expenditure (for example, get and keep all of the receipts for the meals). Svetlana cannot claim anything for accommodation because her employer pays for it. She also cannot claim anything for incidentals because she doesn't spend anything on incidentals while travelling away from home for work.

27. If we check Svetlana's tax return, she may be asked to establish that she satisfies the rules for deductibility and has included the travel allowance in her tax return. To do this, Svetlana would need to show that she:

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travelled to and worked in Sale for 4 days each month

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received an allowance for the meals and incidentals for each day she travelled

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correctly declared this allowance as income in her tax return

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typically spent $135 a day on meals, and

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wasn't reimbursed by her employer for the costs she incurred.

28. To do this, Svetlana could show her pay slip which includes her travel allowance, diary notes, bank statements, menus, and some receipts she kept on some of the trips to show how she arrived at her claim of $135 per day. If applicable, she could also show a letter from her employer that states she was not reimbursed.

29. If Svetlana spends more than the reasonable amount on meals and incidentals and wants to claim the higher amount that she spends, she would need to get and keep all of the receipts to substantiate the expenditure, as well as demonstrate deductibility.

30. If Svetlana's meal and incidental allowance was not shown on her income statement and she fully spent the allowance, she can choose to leave it out of her tax return and not claim any deductions for the meals and incidentals that she purchases while travelling and working in Sale.

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Reasonable amounts for domestic travel expenses for employee truck drivers

31. Reasonable amounts for domestic travel expenses for employee truck drivers^[6] are given for meals (breakfast, lunch and dinner). The amounts are for all domestic travel destinations (that is, capital cities, regional and country centres). For the 2026–27 income year, the relevant amounts are as set out in Table 5 of this Determination.

32. The amounts for each of these meals are separate and cannot be aggregated into a single daily amount.^[7] This is of particular importance for the days on which travel commences and ends, when some meals may not be deductible because they are not consumed in the course of work travel. A driver's work diary (as maintained for fatigue-management purposes) can be used to demonstrate when meal breaks were taken, since employee truck drivers may take meal breaks at different times of the day compared to other taxpayers. It should also be noted that amounts cannot be moved from one meal to another (for example, if the full amount for breakfast is not expended, it cannot be carried over to lunch or dinner).

33. The deduction allowed for each meal is the amount actually spent and not simply the reasonable amount specified in Table 5 of this Determination. Although the formal substantiation requirements do not apply for claims up to the reasonable amount, taxpayers need to be able to demonstrate that they satisfy the rules for deductibility under section 8-1. Example 3 of this Determination shows how this can be done.

34. All accommodation expenses and incidental expenses (for example, the cost of a shower) incurred by employee truck drivers as part of work-related travel must be substantiated with written evidence (for example, a receipt).

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Example 3 – calculation of reasonable amount for meals – employee truck drivers

35. Glenn is an employee truck driver. He is required to drive from Melbourne to Adelaide. Glenn leaves Melbourne at 9:00 pm, sleeps away from home overnight in his truck cab, then drives back to Melbourne the following day. Glenn is paid a travel allowance of $80 for each day. These amounts are shown on his income statement.

36. While still in Melbourne, Glenn spends $10 on fresh fruit and nuts to snack on while he travels as these items are hard to get where he stops. Glenn stops around midnight at a 24-hour truck stop in Horsham and spends $40 on food and drink (some of which is consumed later during the trip). He then continues to Adelaide where he snacks on a sandwich that he brought from Horsham, and the fruit that he brought in Melbourne, before having a sleep in the truck cab. In the morning, Glenn spends $25 on food and drink at the truck stop where he parked overnight. After the truck is unloaded and reloaded, Glenn heads to Bordertown where he stops for lunch. Here, he spends $30 on food and drink. He then continues to Melbourne arriving at 5:00 pm, snacking on almonds and fruit that he brought from Melbourne as he drives.

37. As Glenn spent less than the reasonable amount for each of dinner, breakfast and lunch, he can claim a deduction for the full amount that he spent on those meals ($105) and is not required to obtain and keep all of the receipts for these meals.

38. If we check Glenn's tax return, he may be asked to establish that he satisfies the rules for deductibility and has included the travel allowance in his tax return. To do this Glenn would need to:

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show that he travelled to and from Adelaide (for example, his work diary)

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show that he received an allowance for the meals for each day that he travelled

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show that he correctly declared this allowance as income in his tax return

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demonstrate his typical spending pattern on meals (this could be by reference to diary entries, bank records and receipts kept for some (a representative sample) of his trips), and

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show he wasn't reimbursed by his employer for the costs he incurred.

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Reasonable amounts for overseas travel expenses

39. If you are travelling overseas and are away from your usual residence for 6 or more nights in a row, you must still keep travel records even if you rely on the reasonable amounts and do not have to substantiate your expenses. Travel records may include ticketing information, diary entries or other information setting out the nature of your travel, the day and time it began, how long it lasted and where you travelled.

40. Reasonable amounts are provided in this Determination for 3 salary levels. Salary excludes any allowances received.

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Use Table 6 if your salary is $153,210 or less.

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Use Table 7 if your salary is between $153,211 and $272,680.

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Use Table 8 if your salary is $272,681 or more.

41. Reasonable amounts are given for:

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meals (showing breakfast, lunch and dinner), and

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expenses incidental to travel.

42. Any expenditure on accommodation overseas must be fully substantiated.

43. Reasonable amounts are shown for cost groups to which a country has been allocated. Table 9 of this Determination sets out the cost group to which a country has been allocated.

44. If you travel to a country that is not shown in Table 9 of this Determination, and you are not using an alternate provider's data, use the reasonable amount for cost group 3 in the table relevant to your salary range. We use the cost group values of countries listed to reflect the reasonable costs of unlisted countries.

45. If you travel to 2 or more countries in the same day, use the cost group of the country that is in the higher cost group in determining the reasonable amount for that day.

46. The reasonable amount for incidentals applies in full to each day of travel covered by the allowance, without the need to apportion for any part-day travel on the first and last day.

47. The reasonable amounts for overseas travel expenses per day according to salary levels and cost groups for the 2026–27 income year are shown in Tables 6 to 9 of this Determination.

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Example 4 – calculation of reasonable amount for meals and incidental expenses – overseas

48. Prashant travels to China on business for 2 weeks and is paid a travel allowance of $550 per day (made up of $300 for meals and incidentals and $250 for accommodation). Prashant's annual salary is $191,000. Prashant spends $300 per day on meals and incidentals and $300 per night on accommodation when travelling in China. Prashant calculates the daily reasonable amount for his overseas travel as follows:

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Table 7 of this Determination applies because Prashant's salary is between $153,211 and $272,680.

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Table 9 of this Determination lists China as Cost group 5.

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Table 7 of this Determination provides reasonable amounts for meals and incidental expenses for Cost group 5 as $290 per day for meals and $50 per day for incidentals (that is, a total of $340 per day).

49. As Prashant spends less than the reasonable amount on meals and incidentals, he can claim a deduction for the $300 per day that he spends and he is not required to substantiate the expenditure (for example, get and keep all of the receipts for the meals and incidentals). However, because he spends more than 6 nights away in a row, Prashant must keep travel records (such as a travel diary) for the 2 weeks he is in China. Prashant can claim a deduction for the $300 per day he spends on accommodation, but he must fully substantiate this expenditure (by getting and keeping a receipt or other documentary evidence of the expenditure).

50. If we check Prashant's tax return, he may be asked to establish that he satisfies the rules for deductibility and has included the travel allowance in his tax return. To do this, Prashant would show he:

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travelled to China for work

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received an allowance for the meals and incidentals for each day he travelled

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correctly declared this allowance as income in his tax return

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typically spent $300 a day on meals and incidental expenses (for example, by reference to diary entries, bank records and some receipts that he kept), and

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wasn't reimbursed by his employer.

51. If Prashant's travel allowance for meals and incidentals were not shown on his income statement and he fully spent the allowance, he can choose to leave this allowance out of his tax return and not claim any deductions for the meals and incidentals he purchases when travelling and working in China. His accommodation allowance will have been included on his income statement as Prashant's employer must withhold from the accommodation allowance.^[8]

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Date of effect

52. This Determination applies to the 2026–27 income year only.

Commissioner of Taxation
24 June 2026

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References

ATO references:
NO 1-1BJ68BF7

Previous Rulings/Determinations:
TD 2021/6
TD 2022/10
TD 2023/3
TD 2024/3
TD 2025/4

Related Rulings/Determinations:

TR 2004/6
TR 2020/1
TR 2021/4

Business Line:  IAI

Legislative References:
ITAA 1997 8-1
ITAA 1997 Div 900
ITAA 1997 900-50
ITAA 1997 900-55
ITAA 1997 900-60

Other References:
Taxation Administration (Withholding Variation for Payment of Certain Allowances) Legislative Instrument 2025