Applying for deduction
Scenario:
I work as an executive regional chef and travel throughout the year for work. My accommodation expenses are covered by my employer. However, meals are not included. Can I claim meal expenses base on the ATO reasonable meal amounts even though no value has been reported on the payment summary as travel allowance?
Explanation:
A deduction can be claimed but there are a couple of conditions:
- The allowance must be included in income. Even though it is not included in the payment summary, it will still need to be shown as income on the tax return. If it is not, no deduction can be claimed.
- The amount that can be claimed is not the ATO reasonable meal amount, it is the amount actually spent. If that amount is less than the Commissioner's reasonable allowance, no substantiation is required. If that amount is more than the Commissioner's reasonable allowance, full substantiation is required.
This is a "hot" issue that the ATOs focusing on this year (many people get it wrong and automatically claim the Commissioner's allowance even though they have spent less) so it pays to ensure that you get it right.