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Edited version of your written advice
Authorisation Number: 1013139770896
Date of advice: 15 December 2016
Ruling
Subject: Meal allowance
Question and answer
Are you able to claim $X per day as a deduction for travel expenses without substantiation?
Yes.
This ruling applies for the following periods:
Year ended 30 June 2016
The scheme commenced on:
1 July 2015
Relevant facts and circumstances
This ruling is based on the facts stated in the description of the scheme that is set out below. If your circumstances are materially different from these facts, this ruling has no effect and you cannot rely on it. The fact sheet has more information about relying on your private ruling.
Your employer provides you with a travel allowance of $X.
This payment is reflected on your weekly payment slip but not your annual payment summary where it forms part of the gross amount.
You have not kept receipts for the amounts spent.
You worked away for Y days in the 2016 income year.
Relevant legislative provisions
Income Tax Assessment Act 1997 Section 8-1.
Reasons for decision
An expense is deductible under section 8-1 of the Income Tax Assessment Act 1997 (ITAA 1997) if and to the extent to which it is incurred in gaining or producing your assessable income or in carrying on a business for that purpose. However you cannot claim a deduction for an expense that is of a capital, private or domestic nature.
A deduction is only allowable if an expense:
● is actually incurred
● meets the deductibility tests
● Satisfies the substantiation rules.
Work-related travel expenses you incur that are directly related to your work as an employee include:
● public transport, including air travel and taxi fares
● bridge and road tolls, parking fees and short-term car hire
● meal, accommodation and incidental expenses you incur while away overnight for work
● expenses for motorcycles and vehicles with a carrying capacity of one tonne or more, or nine or more passengers, such as utility trucks and panel vans
● actual expenses (such as any petrol, oil and repair costs) you incur to travel in a car that is owned or leased by someone else.
Taxation Ruling TR 2004/6 Income tax: substantiation exception for reasonable travel and overtime meal allowance expenses and ATOID 2015/14 explains the way in which the substantiation exception operates for work expenses of employees that incur either reasonable travel allowance expenses or reasonable overtime meal allowance expenses.
Paragraph 11 of TR 2004/6 explains that an expense must actually be incurred before a claim can be made. A taxpayer cannot automatically claim a deduction just because they receive an allowance.
Paragraph 15 of TR 2004/6 highlights that if a taxpayer relies on the exception from substantiation, they may still be required to show the basis for determining the amount of their claim, that the expense was actually incurred and that it was for work-related purposes.
Paragraph 41 of 2004/6 states that the receipt of a travel allowance or an overtime meal allowance does not automatically entitle an employee to a deduction, nor does the amount of an allowance received determine if the claim is reasonable.
Paragraph 54 of TR 2004/6 clearly states that “the travel allowance must be paid to cover the cost of accommodation (domestic travel only) or food or drink or expenses incidental to the travel (paragraph 900-30(3)(b) of the ITAA 1997)”.
Only the actual amount incurred on work-related travel expenses can be claimed as a deduction.
Your employer pays you $X travel allowance.
This payment is reflected on your weekly payment slip but not your end of financial year payment summary where it forms part of the gross amount.
You are able to claim a deduction for the travel expenses.
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