Business deductions: Travel expenses: Tax basics for small business


You can generally claim a deduction for travel
expenses if it’s connected to your business, but any travel before you actually start your
business is not usually deductible. If you run your business through a company
or trust, the company or trust can claim a full deduction for expenses for business travel.
But if the travel is partly for private purposes, it might have to pay fringe benefits tax,
or FBT. MARY’s trip to Europe to study international
cuisine and café décor before she opened her café is not deductible. JASON’s trip to work on the Chelsea Flower
Show as part of his landscaping business is deductible. But the 2 weeks he spent in Bali
on the way home isn’t, so he must apportion the claim and exclude the non-business component.
It’s important to keep records to substantiate your claim. Make sure you keep receipts, boarding
passes and a diary. If you’re away for 6 or more consecutive nights you must keep a diary
and record the nature of any business activity, the day and approximate time the activity
began, where you engaged in the activity and how long it lasted. For more information on claiming travel expenses,
visit the ATO’s website.

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