While the end of financial year still seems a while away, ourselves and many other are busy preparing for tax season. One of the most common questions we receive is about claiming deductions for attending professional development events, like conferences, workshops, and training courses. As a pharmacist, you’re likely thinking about the upcoming Australian Pharmacy Professional Conference (APP) – an event we’ve been fortunate to attend in past years. This is a favourite topic amongst deductions so we thought we would provide some further insights to help you get the most out of your tax deductions as you continue your career development.
What Can You Claim?
To ensure you're claiming everything you're entitled to, it’s essential to understand what qualifies for a tax deduction when attending conferences and training:
Registration Fees: You can claim the full cost of the event registration.
Travel: Travel expenses to attend the event, including flights, trains, car hire, parking, and even Uber/taxi rides, are eligible for deductions if the event isn’t held at your regular workplace.
Accommodation and Meals: If your event requires overnight travel, the cost of accommodation and meals is deductible. Just keep in mind that any personal meals or activities are not.
When Can You Claim the Full Deduction?
This is where things can get tricky, so it’s essential to clearly differentiate between personal and work-related expenses:
Work Trip: If you attend a 5-day conference but decide to stay an extra day for social activities organised by the event, you can usually claim the full expenses (registration, travel, accommodation, and meals) for the work-related portion.
Personal Trip: If you’re on holiday and decide to attend a course, you can only claim the training costs – not travel or accommodation.
Dual Trip: If you bring family along, you’ll need to apportion the costs. Only the work-related days and activities are deductible, and any costs for family members are non-deductible.
Are There Any Limits on What You Can Spend?
While you’re entitled to claim these deductions, you must keep in mind that there are some limits on what the ATO deems reasonable:
Flights: You can claim business class if it’s necessary for the business trip, but be mindful of the purpose of the travel.
Accommodation: As with flights, the ATO won’t dictate what’s "reasonable" but will review the purpose of the stay.
Meals: The ATO has published guidelines on what they consider reasonable for meals during travel each year. If you spend more than $300 GST-inclusive per employee on meals, you could face Fringe Benefits Tax (FBT) consequences.
Entertainment: Personal entertainment costs, such as drinks and shows, are not deductible.
Partners, Friends and Family: This is deemed personal in nature so a deduction will be disallowed. You will need to apportion these expenses as a non-deductible expense.
What About Employees?
As an employee pharmacist or pharmacy assistant, you may also be able to claim some of these deductions, depending on the situation.
Paid by Employer: If your employer pays for the event, you can’t claim it. The employer can claim it instead.
Reimbursed: If your employer reimburses you, you also cannot claim a deduction.
Travel Allowance: If you receive a travel allowance from your employer, it should be processed through payroll and will appear as income. You can then claim the corresponding work-related expenses on your tax return.
Record-Keeping is Key
One of the most important aspects of claiming your deductions is keeping accurate records. It's not just about keeping receipts but also maintaining a travel diary that documents:
The nature of the activity/event
Date, time, and duration of work/business-related activities
The location of the activities
The more details you record, the easier it will be for your accountant to ensure you’re claiming everything you can.
Need Help?
With the end of the financial year fast approaching, we know many pharmacists are gearing up for tax season. As your trusted accounting team, we’re available to answer any questions you might have and ensure you're maximizing your deductions. Feel free to reach out to us at Peak Strategies—we’re ready to help you get the most out of your claims as you continue to upskill and grow your pharmacy business!
