An overtime meals allowance should normally be itemised on your annual payment summary, identified separately (and in addition to) your gross wages.
When itemised in this way, it should be declared as income in your tax return, but if you have worked overtime, and subject to the following conditions, it may be claimable as a tax deduction.
Reasonable Overtime Meal Allowances as determined by the Commissioner of Taxation (updated annually) are:
- for 2018-19 $30.60 per meal
- for 2017-18 $30.05 per meal
- for 2016-17 $29.40 per meal
Allowances for earlier years are set out in the table below.
If you work overtime, you can claim a deduction for overtime meal expenses (food and drink) if..
- you purchased a meal when you worked overtime and
- you received an overtime meal allowance under an industrial award for working overtime.
Claiming a tax deduction for meals
Where the tax deduction claimed is no more than the reasonable allowance amount, written evidence is not required in support of the claim. However, you could still be required to demonstrate the genuine basis of the claim, by showing how it was worked out, and the work circumstances.
If you have received an overtime meals allowance which is not shown on your payment summary, it does not have to be declared as income in your tax return providing..
- you have spent all the allowance on deductible expenses and
- you do not make any claim for the expenses in your tax return.
Claims for more than the allowance
Claims which are for more than the reasonable amount, must be fully substantiated – supported by written evidence.
If an amount for overtime meals has been paid to you as an unspecified part of your normal salary or wages, it is not considered to be an overtime meal allowance. (In that case, it would also not normally be itemised on your payment summary and does not need to be separately declared in your tax return).
The question is not merely whether the money was properly spent on overtime meals. The requirement that a claimed allowance be specifically referenced to an Award requirement is strict and explicit – as this AAT case shows. The overtime meal allowance in that case was found in fact to be simply a notional apportionment of the taxpayer’s gross salary, and therefore did not have the fundamental award-based connection, and the claimed deduction was therefore disallowed. To add pain to the taxpayer’s loss, not only did the taxpayer lose his claim, but the tribunal also affirmed a 25% penalty for having made false and misleading statements in his tax return, and a failure to take reasonable care.
Each financial year the ATO updates the “Reasonable Overtime Meal Allowance Amount” (see Reasonable Travel Allowances)
|Reasonable Overtime Meal Allowance|
|Year||Amount per meal|
Payg Tax Withholdings on Overtime Meals Allowances
Tax is not required to be withheld from award overtime meal allowances unless they are more than the reasonable amounts set by the Tax Office each year. To be exempt from tax deductions, the allowance must be paid under an industrial instrument in connection with overtime worked.
- For information about travelling allowances – see ATO Reasonable Travel Allowances
- PAYG Withholding Variation: Allowances
This page was last modified 2018-07-02