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Australia Travel Allowance & Per Diem Guide

Australian travel allowance and per diem tax rules. The guide covers: the travel allowance paid by the employer — the 'travel allowance' is the 'payment by the employer to the employee' for the 'travel expenses' incurred in the 'course of the employment' (the 'overnight travel', the 'meals', the 'accommodation', the 'incidental expenses'); the 'travel allowance' is 'included in the assessable income' of the 'employee' and is 'subject to the PAYG withholding'; the 'employee' can 'claim the deduction' for the 'actual travel expenses' incurred (the 'receipts-based deduction') or use the 'ATO reasonable travel allowance amounts' (the 'per diem rates') to 'claim the deduction WITHOUT the receipts' (the 'substantiation exemption'); the ATO reasonable travel allowance amounts — the 'ATO publishes the 'reasonable travel allowance amounts' each year (the 'TD series — the 'Taxation Determination')'; the 'reasonable amounts' for the '2025-26 year': (i) the 'overnight travel within Australia' — the 'meals and the incidentals' at $45.00 per night for the 'breakfast, the lunch, the dinner, and the incidentals', (ii) the 'overnight travel within Australia' — the 'meals and the incidentals' at $22.50 per night for the 'half-day travel', (iii) the 'overnight travel outside Australia' — the 'meals and the incidentals' at the 'overseas per diem rates' (the 'DFAT overseas travel rates'); the 'reasonable amounts' for the 'accommodation' are NOT specified by the 'ATO' — the 'employee must substantiate the 'actual accommodation costs''; the substantiation exemption — the 'employee does NOT need to 'keep the receipts' for the 'meal expenses and the incidental expenses' if: (i) the 'travel allowance was paid by the employer', (ii) the 'travel allowance is INCLUDED in the assessable income', (iii) the 'total travel allowance does NOT exceed the $300 per trip or the total of $9,000 per year' — the 'substantiation exemption' applies up to $300 per trip and $9,000 per year (the '2024 ATO safe harbour limits'); the 'travel allowance that exceeds $300 per trip or $9,000 per year requires the 'full substantiation' (the 'receipts' for the 'total expenses incurred'); the overnight travel deductions — the 'employee' can claim the 'deduction for the travel expenses' incurred for the 'work purposes': (i) the 'plane, the train, the bus, and the taxi fares', (ii) the 'car expenses' (the 'cents per km method at 85 cents per km' or the 'logbook method'), (iii) the 'accommodation costs' (the 'hotel, the motel, the serviced apartment'), (iv) the 'meal expenses' (the 'ATO reasonable amounts or the actual costs'), (v) the 'incidental expenses' (the 'parking, the tolls, the laundry, the tips'); the 'travel deduction' is ONLY available if the 'travel is for the work purposes' — the 'travel that is the 'private travel' or the 'commuting to the regular workplace' is NOT 'deductible'.

ATO Reasonable Travel Amounts

  • $45 per night (meals & incidentals): The 'ATO reasonable amount' for the 'overnight travel within Australia' is $45 per night for the 'breakfast, the lunch, the dinner, and the incidentals'.
  • $22.50 per night (half-day): The 'half-day travel' rate is $22.50 per night.
  • Overseas rates: The 'overseas per diem rates' follow the 'DFAT overseas travel rates'.

For the motor vehicle tax deductions and the car expenses, see our Motor Vehicle Tax Guide →.

Substantiation Exemption

  • No receipts required: The 'employee does NOT need the receipts' if the 'travel allowance is paid' and 'included in the assessable income'.
  • $300 per trip / $9,000 per year: The 'substantiation exemption' applies to the 'allowances up to $300 per trip' and '$9,000 per year total'.
  • Full substantiation above the limits: The 'receipts are required' if the 'allowance exceeds $300 per trip or $9,000 per year'.

For the business expenses and the record keeping, see our Business Expenses Guide →.

Travel Deductions

  • Work-related travel: The 'plane, the train, the bus, and the taxi fares' for the 'work travel' are 'deductible'.
  • Accommodation: The 'hotel, the motel, and the serviced apartment costs' are 'deductible' for the 'overnight work travel'.
  • Private travel not deductible: The 'commuting to the regular workplace' is NOT 'deductible'.

For the business income and the deductions, see our Business Expenses Guide →.