ATO Eyes Fun Deductions

Work related travel expenses face new scrutiny by the Australian Taxation Office as it cracks down on promoters offering holidays dressed up as “self-study” work packages.

The ATO said it had identified a growing market for these  holidays that may lead taxpayers to making inflated claims for overseas travel and other related costs.

The ATO said it had identified a number of entities marketing these packages which offer seminars or study options as part of a much longer holiday type package.

These type of packages encourage people to go on holidays and engage in a very small amount of activities which would qualify as work related studies.  The ATO has not named the so called promoters of these schemes, but that they are mainly in capital cities and are marketing to highly paid professionals such as Doctors, Dentists, Lawyers and Engineers.  The ATO is concerned that these people are offering holidays which just look like work related study and offer very little in the way of professional development for the length of the so called seminar.

Examples quoted include a cruise ship trip, where a professional attends a seminar for a few hours in a cruise which lasts for several days, or someone who takes a self paced study package or participates in an online seminar whilst at the destination of their choice.  These taxpayers then claim a deduction for the cost of airfares, cruise fares, food & accommodation costs all under the Self-Education deduction in their tax returns.

Similar packages were being marketed to investors and self funded retirees which included short investment seminars during the several day trip.

The Australia Taxation Office have again stated the importance of a travel diary for those who are taking trips which combine both self-study and personal recreation and to be very careful in attributing their costs.