One area which causes a lot of confusion among businesses is whether they can claim meals as a tax deduction.

It gets really tricky, and is not a simple yes/no answer. In some instances the Tax Office will allow a tax deduction in your business tax return for your meal. In other instances, the Tax Office will consider your meal as “Entertainment”. When classed as “Entertainment”, you are also subject to Fringe Benefits Tax (another tax).

What causes a lot of confusion on this topic is that the ATO has not provided a clear definition of entertainment when it comes to meals. They have, however, provided some examples which we use as a guide, and which asks four questions to reach a decision as to whether your meal is entertainment or not. Continue reading “Can I claim meals as a tax deduction?”