How to Claim the Right Amount of Tax Deductions for Your Overtime Meal Expenses and Domestic Travel Expenses

The Australian Taxation Office (ATO) has released a new determination setting out the reasonable amounts that employees can claim for overtime meal expenses and domestic travel expenses for the 2023-24 income year.

The determination applies to employees who receive an allowance to cover the specific expenses they are claiming. It does not apply to employees who do not receive an allowance to cover their expenses.

The reasonable amounts are only the maximum amount that employees can claim without being required to substantiate their expenditure. If employees rely on the reasonable amounts and the ATO checks their tax return, they will still be required to show that they:

• Spent the money in performing their work duties
• Worked out their claim correctly
• Spent the money themselves
• Correctly declared their allowance as income in their tax return

Overtime Meal Expenses

The reasonable amount for overtime meal expenses for the 2023-24 income year is $35.65. This amount applies to all employees, regardless of their salary level.

For example, let’s say you work overtime one night and you spend $40 on a meal. You can claim the $35.65 reasonable amount and you will not need to keep a receipt for the meal.

The reasonable amount for overtime meal expenses is based on the cost of a standard meal in a commercial establishment. It does not include the cost of alcohol or other beverages.

If an employee spends more than the reasonable amount for overtime meal expenses, they can claim the higher amount if they can substantiate their expenditure. However, if an employee spends less than the reasonable amount, they cannot claim a deduction for the difference.

Domestic Travel Expenses

The reasonable amounts for domestic travel expenses are different for employees at different salary levels. The amounts also vary depending on the destination of the trip.

The following table shows the reasonable amounts for domestic travel expenses for employees with a salary of $138,790 or less:

Expense	Reasonable Amount
Accommodation	$180 per day
Meals	$40 per day
Incidental expenses	$10 per day

The following table shows the reasonable amounts for domestic travel expenses for employees with a salary of between $138,791 and $247,020:

Expense	Reasonable Amount
Accommodation	$200 per day
Meals	$45 per day
Incidental expenses	$10 per day

The following table shows the reasonable amounts for domestic travel expenses for employees with a salary of $247,021 or more:

Expense	Reasonable Amount
Accommodation	$220 per day
Meals	$50 per day
Incidental expenses	$10 per day

The reasonable amounts for domestic travel expenses also vary depending on the destination of the travel. For example, the reasonable amount for accommodation in Sydney is higher than the reasonable amount for accommodation in Darwin.

For example, let’s say you have a salary of $138,790 or less and you travel to Sydney. The reasonable amount for accommodation is $176 per night. The reasonable amount for meals is $25 for breakfast, $30 for lunch, and $40 for dinner. The reasonable amount for incidentals is $10 per day.

So, if you travel to Sydney for a week, you could claim the following expenses:

• Accommodation: $176 x 7 = $1232
• Meals: $25 x 7 + $30 x 7 + $40 x 7 = $490
• Incidental expenses: $10 x 7 = $70
• Total expenses: $1232 + $490 + $70 = $1802

You can claim these expenses on your tax return.

Note: The full details of the reasonable amounts for overtime meal expenses and domestic travel expenses can be found in the ATO determination.

How to Claim Reasonable Amounts

To claim reasonable amounts for overtime meal expenses or domestic travel expenses, you must first ensure that you are eligible to claim them. If you are eligible, you can claim the reasonable amounts by including them in your tax return.

When you claim reasonable amounts, you must also provide evidence to support your claim. These records should include:

• A diary or logbook detailing your travel expenses
• Receipts for any expenses that you incur
• A copy of your payment summary showing the amount of the allowance you received

If you are audited by the ATO, you may be asked to provide further evidence to support your claim.

Examples of Other Expenses You Can Claim

In addition to the reasonable amounts for overtime meal expenses and domestic travel expenses, there are a number of other expenses that you may be able to claim as a deduction. These include:

• The cost of transport to and from work
• The cost of parking at work
• The cost of uniforms and protective clothing
• The cost of tools and equipment
• The cost of professional subscriptions
• The cost of training courses

If you incur any of these expenses in the course of your employment, you should keep records to support your claim.

Conclusion

The ATO’s determination on reasonable amounts for overtime meal expenses and domestic travel expenses provides a helpful guide for employees who are claiming these expenses. By understanding the reasonable amounts and providing the necessary evidence, employees can ensure that they are claiming the correct amount of tax deductions.

In addition to the information provided in the blog post, here are some additional tips for claiming reasonable amounts:

• Keep good records of your expenses. This includes receipts, credit card statements, and diary entries.
• Be accurate in your calculations. The ATO may ask you to provide evidence to support your claims, so it is important to be accurate.
• Be aware of the limitations on claiming reasonable amounts. For example, you cannot claim reasonable amounts for accommodation if you are staying with friends or relatives.

By following these tips, you can ensure that you are claiming the correct amount of tax deductions for your overtime meal expenses and domestic travel expenses.

Ready to Claim Your Expenses in the 2023-24 Income Year? Talk to Us!

If you’re looking to make this tax season a breeze, our experts know a thing or two about the same and they can help you do that with ease. Just drop us a line at info@nanakaccountants.com.au, and we’ll take it from there!