Private ruling: Travel expenses
Date of advice: 23 March 2026
Published: 9 June 2026
Ruling period: Year ended DD MM YY
Date scheme commenced: DD MM YY

Ruling: Q1: Are you entitled to claim a deduction under section 8-1 of the Income Tax Assessment Act 1997 (ITAA 1997) for your overseas travel expenses, including airfares, accommodation and related incidentals, incurred in travelling to overseas destinations? | A1: No. | Q2: Are you entitled to claim your meal and incidental expenses on a reasonable basis in accordance with Taxation Determination TD 2025/4 Income tax: reasonable travel and overtime meal allowance expense amounts for the 2025-26 income year (TD 2025/4) for the period of your travel? | A2: No.

Relevant facts and circumstances: You have been employed with XXXX since DD MM YY in a role that involves researching and recommending travel destinations, accommodation options, and tourist activities to clients. Due to the nature of your employment, when you travel, some travel-related expenses, such as certain cruise or accommodation components, are paid by travel providers under familiarisation or industry arrangements. You do not receive any travel allowance or reimbursement from your employer in relation to your travel. You seek to claim a deduction for expenses incurred in relation to two overseas trips: • Trip 1 - involved a cruise to Destination A and Destination B, commencing on DD MM YY. - The cruise fare was paid by the cruise company. - You paid for your airfare and for accommodation when not on the cruise. - Your partner accompanied you, however you wish to claim for only XX% of your share of your expenses because you consider XX% of your expenses to be private. • Trip 2 - involved travel to Destination C, commencing on DD MM YY. - You paid for your airfare and accommodation. - You wish to make a claim only in relation to your half share of the costs (you were accompanied on the trip) and will also reduce your claim by a further XX% to reflect what you consider to be the private nature of part of the trip. You provided a letter from your employer confirming that you have been employed since DD MM YY and that your duties include marketing domestic and international travel products to clients. The letter states that it is beneficial for you to travel to various destinations at your own expense to remain informed about travel trends, offers and locations. It further states that the employer considers such travel to support your role by assisting in generating ongoing business, and that you continue to benefit from the research undertaken during these trips when selling travel packages and related products. The letter also notes that minor discounts may be received from some suppliers but that your remuneration package does not otherwise cover these travel-related expenses. For the relevant trips, all days away from work were taken as annual leave. Your terms of employment document dated DD MM YY sets out the types of leave you are entitled to. It does not make any reference to educational leave. You have retained invoices and receipts for airfare and accommodation expenses for both trips, but you did not maintain a detailed travel diary.

Relevant legislative provisions: Income Tax Assessment Act 1997 section 8-1 | Income Tax Assessment Act 1997 section 900-20 | Income Tax Assessment Act 1997 section 900-150

Reasons for decision: Summary: Are you entitled to claim a deduction under section 8-1 of the Income Tax Assessment Act 1997 (ITAA 1997) for your overseas travel expenses, including airfares, accommodation and related incidentals, incurred in travelling to overseas destinations? No. Section 8-1 of the ITAA 1997 allows a deduction for losses and outgoings to the extent that they are incurred in gaining or producing assessable income. However, a deduction is not allowable where the expenses are of a capital, private or domestic nature, or relate to the earning of exempt income. For travel expenses, the substantiation rules in Division 900 of the ITAA 1997 apply. Under section 900-20, you must keep travel records when you are away from home for six or more nights in a row. Section 900-150 requires that these records take the form of a travel diary. A travel diary must show the dates, places, times, duration and purpose of each activity. You advised that you did not keep a travel diary for any of your overseas travel. As a result, you have not met the substantiation requirements under Division 900 of the ITAA 1997. These requirements must be satisfied before a deduction can be allowed, even if the travel may otherwise have had a work-related purpose. In addition to the substantiation requirements, the expense must meet the requirements for deductibility under section 8-1 of the ITAA 1997. The ATO's public guidance for travel agents states that a deduction may be available where the employer provides educational or familiarisation travel to learn about new products or tour destinations, or where the employee uses educational leave to undertake such travel. You do not satisfy either of these conditions. Although you advised that your employer provides educational leave of X days per year, when asked for documentation about this entitlement you stated that you could not provide any. In any case you did not take any educational leave for the two trips you wish to claim for, rather only annual leave was taken for these trips. You said this was because you had taken education leave for another trip for which no deductions were claimed. However, as mentioned previously you have not supplied any documentation to evidence any entitlement to educational leave. More detailed guidance on educational and familiarisation travel for travel agent employees can be found by searching for QC 19099 on ato.gov.au. This guidance includes the following: It is common within the industry for sales staff to be offered or to take discounted holiday packages and trips. These are often referred to as 'educationals' or 'familiarisations'. While the knowledge and experience gained on any overseas, interstate or local trip could be of benefit to, and may be utilised in their employment, that alone isn't sufficient to make the expense deductible. If you claim a deduction for some or all the expenses of the trip, you need to be able to show that the trip was more than a holiday. To keep a record of your travel activities you can use a travel diary that shows the dates, places, times and duration of your activities and travel. Taking a photo journal, recording the trip in a diary or inspecting some accommodation is unlikely to result in the travel being considered as work related rather than a private expense. The detailed guidance also contains several examples. In the first example where a deduction was allowed, the taxpayer kept a travel diary and detailed notes on every aspect of the tour to share with colleagues and clients on their return, and received a commission for each tour they sold. In the second example where a deduction was allowed, the taxpayer was selected by their employer to experience a new tour developed by a wholesale travel company which paid for the flights, accommodation and any tour expenses, with the taxpayer only having to pay the airport taxes and their meal expenses. In the third example, the taxpayer was asked by their employer to attend a meeting on one of the days during their 14 day tour and was only allowed a deduction for the cost of their accommodation the night before the meeting and the cost of meals on the day of the meeting. Your circumstances are not similar to any of the examples where a deduction was allowed. Rather, they are comparable to the following example: | Detailed Reasoning - Example: no deduction for private travel for familiarisation: Sophie is planning a holiday to Thailand with a group of friends. Thailand is a popular destination with many of the travel agency's customers. Sophie believes she can claim a deduction for the cost of this trip as it will provide her with additional information and experience that she can pass on to clients. Sophie can't claim a deduction for the trip as it is private in nature and only generally relates to her work duties. The decision in Re Sanchez and Federal Commissioner of Taxation [2008] AATA 896 ( Sanchez ) was also considered, where the costs incurred by a travel agent in relation to overseas travel were deductible under section 8-1 and substantiated under Division 900 of the ITAA 1997. However, that case is distinguishable from your circumstances. In Sanchez , the taxpayer received commission income that was directly linked to the travel undertaken. In your case, the employment contract provided shows that your remuneration consists solely of salary, and you are not entitled to commission income relating to the sale of travel products. It is also relevant that your employer did not provide any allowance, reimbursement, or other financial support for the travel undertaken. Further, you used annual leave rather than educational leave, which weighs against the travel being undertaken in the course of your employment duties. In your case, the travel may have broadened your knowledge and benefited you in your profession. However, the courts have consistently held that such benefits are insufficient to establish the necessary connection between the expenditure and income-producing activities. The knowledge gained is too general in nature for the expenses to be incurred in the course of gaining your assessable income. This principle is illustrated in Case U109 87 ATC 657, where the taxpayer, a science teacher specialising in geology, undertook a 17-day trip to Indonesia that included visits to geological sites and attendance at a geological congress. Although the taxpayer prepared teaching materials from the trip and used them in his work on return, the Administrative Appeals Tribunal concluded that the trip was essentially recreational in character and not deductible. The Tribunal observed that some taxpayers derive personal and recreational satisfaction from activities connected to their field of endeavour, but that this does not alter the private character of the expenditure. As discussed previously, while the knowledge and experience gained by a travel agent employee on an 'educational' or 'familiarisation' trip could be of benefit to, and may be utilised in their employment, that alone isn't sufficient to make the expense deductible. Your case is similar to the example of 'Sophie' detailed further above. Like in that example, your trips are considered to be private in nature and only generally relate to your work duties. Therefore, your travel expenses do not satisfy the requirements for deductibility under section 8-1 of the ITAA 1997. In any case even if the expenses did satisfy the requirements of section 8-1 of the ITAA 1997 a deduction would still not be allowable because you did not keep a travel diary which is a substantiation requirement under Division 900 of the ITAA 1997 for trips of six or more nights. | Detailed Reasoning - Question 2: Are you entitled to claim your meal and incidental expenses on a reasonable basis in accordance with Taxation Determination TD 2025/4 Income tax: reasonable travel and overtime meal allowance expense amounts for the 2025-26 income year (TD 2025/4) for the period of your travel? | Detailed Reasoning - Answer 2: No | Detailed Reasoning - Detailed reasoning: TD 2025/4 sets out the reasonable amounts that can be used to substantiate meal and incidental expenses only where a taxpayer receives a travel allowance to cover those expenses. Paragraph 3 of TD 2025/4 states: The approach outlined in this Determination can only be used where you receive an allowance to cover the particular expenses you are claiming - for example, you received an accommodation allowance and are claiming accommodation expenses. This Determination is not relevant to you where you do not receive an allowance to cover your expenses. TD 2025/4 relates to claims for the 2025-26 income year. The equivalent Tax Determination for claims for the 2024-25 income year is Taxation Determination TD 2024/3 Income tax: reasonable travel and overtime meal allowance expense amounts for the 2025-26 income year (TD 2024/3). It also states that the reasonable amounts can only be used where you receive an allowance to cover the particular expenses you are claiming. You have confirmed that you did not receive any travel allowance from your employer for the period of your overseas travel. As no allowance was paid, the reasonable amounts specified in either TD cannot be applied. In these circumstances, you are required to substantiate your meal and incidental expenses with written evidence and a compliant travel diary if you wish to claim a deduction. However, in your case even if you met the substantiation requirements, a deduction would not be allowed as we do not consider that the expenses meet the requirements for deductibility under section 8-1 of the ITAA 1997 as discussed further above.