Aussies mixing business and leisure warned not to make these common mistakes

Australians mixing business and personal travel are being warned to be extra vigilant this tax period as the ATO narrows its focus on work-related expenses.

With Australian business travellers now spending double the amount of time on work trips than the global average, Corporate Traveller and Moneywise believe business travellers who tack a few days for leisure on their trip will be among the ATO’s main focus.

Corporate Traveller global managing director Tom Walley said as the appetite for “bleisure” was anticipated to grow”, business travellers should take “extra care to avoid scrutiny”.

Moneywise global general manager John Tuohy warned taxpayers to ensure they kept adequate records, including scanned copies and a summary of expenses if they choose to mix work and leisure.

“Travellers should keep a travel and expense diary. Often, appropriate annotations in your calendar tool noting dates, times, durations and places of work-related activities will suffice as a ‘travel diary’ for tax purposes and will substantiate deductions for specific and associated expenses,” he said.

Mr Tuohy also warned workers should not be tempted to claim the expenses of a significant other should they decide to bring them along for a work trip.

“Taking a partner or family on these trips would incur expenses that are clearly of a private nature, such as additional accommodation, meal and entertainment expenses. Don’t be tempted to claim these on your tax,” he said.

Similarly, if travellers are thinking about taking a client on a business trip, Mr Tuohy said workers could claim client entertainment expenses but only if the purpose for the expense was income generating.

“Discussing business between parties, a project or negotiating a business outcome is more likely to be deductible. These cases would likely be covered by the employer and reimbursed, and this is more relevant to business owners than employees,” he said.

Mr Tuohy also noted weekend accommodation could be deductible when business extended from a Friday to the following Monday.

Mr Tuohy’s final tip for taxpayers is to remember not to “double dip” and potentially attract attention from the ATO by claiming out-of-pocket expenses that are reimbursed by an employer.