Can I Claim Business Travel (New Zealand) as a Business Expense in New Zealand?
Business travel costs are deductible for the business portion. Domestic and international flights, accommodation, and transport are deductible when travel is wholly for business. Mixed business and personal travel requires apportionment between deductible business days and non-deductible personal days.
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What Inland Revenue (IRD / Te Tari Taake) says
Business travel must have a primary business purpose. Sole traders can use IRD accommodation allowance rates when receiving no reimbursement from an employer. Where international travel combines business meetings with a holiday, IRD requires apportionment based on the ratio of business days to total trip days. Where the primary purpose is personal, IRD may disallow the entire cost. The meal rule for travel follows the entertainment rules: meals an employee buys while travelling on business are generally fully deductible, except where the meal is with an existing or potential business contact or is a celebration, in which case the 50 percent limit applies.
When you can claim
- Domestic flights and accommodation for meetings, client visits, or conferences that are wholly for business
- International travel where the primary purpose is business: full cost deductible if no personal days are added
- Mixed international travel: flights and accommodation apportioned by business days divided by total trip days
- Transport to a client site from the regular workplace (not home commuting)
- Airport transfers, parking and rental cars used for the business part of a trip
When you cannot claim
- Ordinary commuting between home and a regular workplace
- Travel costs for a spouse or family member unless they are employed in the business and travelling for a genuine business purpose
- International travel where the primary purpose is personal, even if some business meetings occur
- Mini-bar, entertainment and personal tours charged to the hotel bill
Good to know
Pro tip: For international trips with mixed business and personal days, keep a day-by-day diary showing which days involved specific business activities. This is essential if IRD audits the apportionment claim.
Important: Travel records should show the date, the destination, the business purpose and the amount. A GST-registered business claims GST on domestic travel with a tax invoice. International flights are zero-rated, so they carry no GST to claim.
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