The ATO is focusing particular attention on motor vehicle and travel expense claims of late and has indicated their focus will be firmly on these deductions for FY2017 tax returns.
Some key areas of concern to note are:
- MV Log Books – The ATO is concerned many log books are invalid. Please note that to claim your work related motor vehicle usage on a log book method, the log book must be in an approved ATO format and be current for a continuous 3 month period within the past 5 years. For further information please see here > or give one of our staff a call.
- Travel Expenses – Please note that if you wish to use the ATO allowable daily rate for accommodation & food expenses when travelling, you must also receive a travel allowance in relation to this travel to use the substantiation exception. Please ensure that your employer includes this on your Payment Summary which will be issued to you shortly.
- Travel Diaries – Please note that if travelling overnight for more than 6 nights in a row, you must keep record in a travel diary. For more information, please see the ATO’s information here >.
- Actual vs Estimated Expenses – The ATO is also concerned that many taxpayers are relying on estimates of expenses rather than providing accurate costs. Please be aware that it is the taxpayer’s requirement to provide substantiation for all deductions claimed and this must be kept for a period of 5 years.