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Claim your deductions for tax time travel

Here’s some good news from the Australian Taxation Office (ATO) - you can now claim the costs of travelling to have your tax return prepared by a ‘recognised tax adviser’. This could include:

  • taxi fares
  • accommodation
  • meals and any other incidental costs

Sometimes your full travel expenses are deductible

Susan and John, partners in a sheep station business located near Meekatharra, travel to Perth for the sole purpose of meeting with their tax agent to finalise the preparation of their partnership tax return. They stay overnight at a hotel, meet with their tax agent the next day and fly back to Meekatharra that night. In this case, the full cost of the trip is deductible.

In some cases where your travel might be related to other purposes, such as a holiday, you might need to apportion the cost, this means you might be able to claim only part of your travel costs, for example:

For business and private purpose

Bill is a sole trader who carries on a pet grooming business in Mandurah. He travels to Melbourne for two days to attend a friend's birthday party and to meet his tax agent to prepare his tax return. He stays one night at a hotel. Bill is travelling to prepare his tax return and for private reasons, so he can’t claim the full cost of his travel. In this case, it's reasonable that half of the total costs of travelling to Melbourne are deductible

When travel is incidental to the main purpose

Georgia runs a catering business in Perth. She has her tax return prepared by a tax agent in Sydney. Georgia travels to Sydney to attend fashion week and while she’s there she decides to stay an extra day to meet with her tax agent. After the meeting Georgia travels back to Perth.

In this case, as Georgia’s trip is mainly for private purposes, it's not reasonable for her to claim all – or even half – of the cost of her travel. She can claim the direct costs of her accommodation for the extra night, incidental costs associated with this time, and the taxi fares from the hotel to her tax agent’s premises and back to the hotel as deductions.

Please note: these examples have all been applied to preparing tax returns, but you could use the same treatment for travelling to see your tax agent about any other tax related matter.

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