Company Expenses

[Plutonus]

Yes, and where the whole allowance is not expended then it must be declared as income (in the case where people receive the reasonable amount and 'pocket' it).

 

[Bolthead]

JQ is fair enough (BFOD policy no doubt), but the cost of transport between airport / hotel / conference is a given. Meals are also something which is usually expected that the company should provide. So this is extremely poor form.

Just asked the wife and they don't have a travel policy. They only have 4 staff per year travelling anywhere so she guesses they don't need one. (i.e. 4 x return flights per year for the entire company)

 

[Blinky]

Does anyone still do the per diem allowance? Used to get that in a govt job. I remember staff used to sleep in cars and eat Maccas to keep as much of the per diem in their pocket as possible. Not me.

Oh, so do I. I used to spend all the TA, and then some.

My last two jobs covered all reasonable costs, including one glass of wine with dinner. They are not-for-profits. Cheapest available airfare (which you could manipulate by making appointment times which meant only one airline worked); hire cars and/or taxis; 4 star minimum accommodation with breakfast. For some reason they didn't cover lunch, but not so bad.

Any less is taking advantage of people who experience the (usual) inconvenience of frequent flying.

 

[Bolthead]

... I'm guessing certain employees at the company see such trips as 'holidays' and think staff are lucky to get them. All meals and transport to and from the conference should be covered....

Yes you are right.... although it is not a holiday most of the staff look forward to it when they get picked. It is a novelty for most of the staff. Because of the nature of the business a trip like this is considered exciting. As for me the last thing I waant to go to is a conference or trade show. My wife has been lucky as she went to the first one which was overseas and has since been to a few others as well. Funny enough she has never been to the one in Sydney.

 

[Bolthead]

Does anyone still do the per diem allowance? Used to get that in a govt job. I remember staff used to sleep in cars and eat Maccas to keep as much of the per diem in their pocket as possible. Not me.

This does remind me of a trip I did to Pt Augusta many moons ago. I was visiting the railway yard (ANR IIRC) and they booked me into the local pub. It was an absolute dive and they said I should make a profit staying at that hotel, not knowing what it meant until the next morning when I found out they got $90 per day for travel expenses. (I think they were Federal govt) Even back in those days I had a company CC. The hotel bill came to $20 inc. breakfast.

 

[NM]

Until about a year ago, I used to receive a per-diem allowance to cover meals while travelling - rates differed by country. Then that was converted to a reimbursement up to a maximum amount (about the same as the per-diem used to be)> No receipts were needed if spend was on corporate credit card, but receipts needed for anything not on the corp card. With a recent change in employer, the maximum amount per day is now significantly less (about 65%) than previously and receipts needed for all reimbursements.

I think I would be better off if they just paid us a $1 per day allowance and then I could claim up to the ATO reasonable amount. But its a global travel policy that applies to a very large number of staff, so I just have to accept that they pay me a salary each month for which I am grateful. The policy is not going to change just because I don't like it. Its my choice to be employed. But I would expect taxi from conference venue to hotel to be paid, especially for women late at night.

 

[markis10]

I think I would be better off if they just paid us a $1 per day allowance and then I could claim up to the ATO reasonable amount. But its a global travel policy that applies to a very large number of staff, so I just have to accept that they pay me a salary each month for which I am grateful. The policy is not going to change just because I don't like it. Its my choice to be employed. But I would expect taxi from conference venue to hotel to be paid, especially for women late at night.

The ATO would rule $1 a day is not a travel allowance, as the allowance must be a reasonable amount that would be expected to cover the costs.

 

[medhead]

Yes, and where the whole allowance is not expended then it must be declared as income (in the case where people receive the reasonable amount and 'pocket' it).

it is off topic to this thread. But in practical terms that's not entirely correct. Reading the ruling if the allowance is not shown on the payment summary then most normal people would determine that they fully expended the allowance. In which case they are not required to include anything on their tax return. With no record of the allowance there is almost zero risk of being checked, and even if they are checked there is no need to physical evidence of having spent the money.

 

[medhead]

The ATO would rule $1 a day is not a travel allowance, as the allowance must be a reasonable amount that would be expected to cover the costs.

I can't see a requirement for travel allowance to be reasonable to cover the expenses. The ruling outlines a reasonable maximum amount but there doesn't appear to be any lower limit. :?:

 

[markis10]

I can't see a requirement for travel allowance to be reasonable to cover the expenses. The ruling outlines a reasonable maximum amount but there doesn't appear to be any lower limit. :?:

Its in the original ruling, which is actually the document you should study before an audit

TR 2004/6 - Income tax: substantiation exception for reasonable travel and overtime meal allowance expenses (As at 21 June 2006)'

86. A 'bona fide travel allowance' is an amount that could reasonably be expected to cover accommodation, or meals or expenses incidental to travel. This does not require that the amount paid by the employer must equate dollar for dollar to the employee's actual expenditure. However there must be relativity between the quantum of the travel allowance and the purpose for which it is said to be paid. A token amount, or a general payment, is not a bona fide travel allowance. In this context the words 'cover' and 'covered' refer to the nature of the expenses for which the allowance is provided, that is the subject matter to be dealt with by the allowance paid, namely accommodation and applicable meal expenses. (See Re McIntosh and F.C. of T. [2001] AATA 702; 47 ATR 1242).

 

[medhead]

Its in the original ruling, which is actually the document you should study before an audit

TR 2004/6 - Income tax: substantiation exception for reasonable travel and overtime meal allowance expenses (As at 21 June 2006)'

See I'm just looking at TD 2013/16.

Edit. Having now looked up bona fide travel allowance; I get back to my earlier question, it seems to me that payment of any amount reasonably expected to cover "accommodation or meals or expenses" would qualify as travel allowance and would therefore make the reasonable amounts for accommodation, meals and expenses claimable and the substantiation exception would apply. Ie being paid an amount for hotels is a bona fide travel allowance which makes the meals and incidentals amounts also available. :?:

Edit2: The paragraph 55 example says that is wrong. Another example of legislation needing to consider the difference between and/or.

 

[Hvr]

Does anyone still do the per diem allowance? Used to get that in a govt job. I remember staff used to sleep in cars and eat Maccas to keep as much of the per diem in their pocket as possible. Not me.

When I worked for the government we received a per diem and upper limit travel amounts. However, you were expected to put everything such as air fares, taxis, hotels etc onto the corporate credit card and if you didn't spend it all then it was lost. This stopped sleeping in their cars and claiming the total amount. For meals the specified amount was able to be taken in cash and spent as required.

When travelling from the airport to the city (and vice versa) you were expected to use the most efficient mode which might be SkyBus in MEL, train in BNE/SYD etc if appropriate, i.e. travelling during the day.

As always some people found ways to rort the system but most were caught and dismissed.

In my current role there's no personal travel.

 

[serfty]

TD 2014/19 - Income tax: what are the reasonable travel and overtime meal allowance expense amounts for the 2014-15 income year? (As at 9 July 2014)

http://law.ato.gov.au/pdf/pbr/td2014-019.pdf

Just a reminder about these for recently completed financial year.