Normally private travel is not deemed as deductible because it is considered private travel. However in some circumstances this is not always the case. We’ve summarised where business owners and employees can deduct travel from work to home.

As an employee, here’s when you can claim travel:

• if your home was a base of employment – you’re required to start your work at home then travel to a workplace to continue your work for the same employer
• if you had shifting places of employment – you regularly work at more than one site each day before returning home
• from your home to an alternative workplace that is not a regular workplace for work purposes, and then to your normal workplace or directly home. This doesn’t apply where the alternative workplace has become a regular workplace
• if you need to carry bulky tools or equipment that your employer requires you to use for work which you can’t leave at your workplace – for example, an extension ladder or a cello.

As a business owner, providing a car to an employee, car fringe benefits tax may apply:

• if they make available a car they own or lease to an employee for their private use.
• The car is a sedan or station wagon OR;
• Any other goods-carrying vehicle with a carrying capacity of less than one tonne, such as a panel van or utility (including four-wheel drive vehicles) OR;
• any other passenger-carrying vehicle designed to carry fewer than nine passengers.

However… The travel of an employees car will be exempt from FBT if private use is limited to:

• travel between home and work
• incidental travel in the course of performing employment-related travel
• non-work-related use that is minor, infrequent and irregular (such as occasional use of the vehicle to remove domestic rubbish).

An example of the tax savings in practice:

Jo operates a digital agency and uses the company motor vehicle to visit clients as well as travel to and from work.

As the company motor vehicle is a four-door utility, Jo’s travel from home to the office and return is deemed business use and tax deductible. The actual tax savings by making the travel to and from home tax deductible will depend on the distances travelled daily to work of course, but should be several thousand dollars per year.

For all of the details around claiming work and home travel check out the ATO’s website here.

More on FBT and exempt motor vehicles here.