Tax deduction for points purchased and used on self funded business travel?

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thehound

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Does anyone have any idea of whether it is allowable to deduct the cost of airline points/miles purchased and subsequently used to obtain award flights which are completely for business use? This scenario pertains to self funded business travel (i.e. not reimbursed by a business or employer).

For example, I recently bought about $700 of Avianca Lifemiles, and used those in combination with about $1020 of cash co-payments to get some J PER-BKK flights for a conference I'm going to later this year. I know I can certainly claim the $1020 cash co-payment as a deduction, but what about the $700 spent on the miles solely for the purpose of getting these flights?
 

cove

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My view would be yes but of course I am not the ATO.
If you can clearly show the flow of money into buying the points for the flight it is just the same as any other type of air ticket purchase.
You will need to keep a travel diary and have your employer ask you to go to the conference.
Just be aware that this is not tax nor financial advice but rather from someone who travels overseas to do business.
In a previous life I was a tax accountant.....but now I am a simple peddler.
 
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Austff

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I am interested in this post . Specifically if points gained from CC use could have a money value & then be claimed as a deduction .
 

deejo77

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Go to the source......ATO has a thing called a private binding ruling - lodge an application and they will let you know yes or no and its based on your particular circumstances.
 

serfty

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My view would be yes but of course I am not the ATO.
If you can clearly show the flow of money into buying the points for the flight it is just the same as any other type of air ticket purchase.
...
My accountant basically agrees with this - if a clear link can be shown between points/miles purchased and their sole use for business purposes then the purchase cost can be fully claimable.
 

knasty

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You wouldn't be the first to do it...I suggest printing a copy of the comparable revenue fare so that, if required, you can show how much lower the deduction you're claiming is vs what it would have been if you paid cash. May be helpful if it becomes an audit point.
 
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The Rok

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Why not ask for a private ruling? Give as much relevant info as possible.
 
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