Expenses in Australia Internal

What can or cannot be expensed? 

While performing business activities in Australia, your supported employees may be required to incur different types of expenses to perform necessary job duties (e.g., asset and materials purchase, travel expenses, local meals, taxis, etc.), and approved expenses will be reimbursed to the supported employee by Velocity Global. In order to be expensed, they must satisfy both of the criteria below: 

1. All expenses must demonstrate that the disbursement or expenditure is strictly indispensable for the core business of the employer.
2. The expense must be duly supported with documents satisfying reimbursement requirements provided in the Australian tax provisions. 

How are expenses reimbursed?

Velocity Global uses a cloud-based expense platform to simplify the expense-reporting process. We will reimburse expenses via direct deposit to the  supported employee’s bank account (no cash or checks) if the following conditions are met:

• The supported employee’s supervisor has approved the expenses
• The expense must be incurred wholly, exclusively, and necessarily in the performance of the supported employee’s duties
• All expenses must demonstrate that the expenditure has been incurred for professional purposes
• The expense, whatever its amount is, must be duly supported with evidence

Can supported employees avoid paying out of pocket and waiting for expense reimbursements?

Unfortunately, no. We can only reimburse an expense once your supported employee submits it in our cloud-based expense platform and provides the supporting documentation.

What are the country-specific expense regulations?

Fringe Benefits Tax (FBT)

Fringe Benefits Tax (FBT) in Australia is a complex and highly regulated area of taxation law, and it applies to the items that an employee benefits from. 

According to the Australian Taxation Office (ATO), Fringe Benefits Tax (FBT) is a tax employers pay on certain benefits they provide to their employees—including their employees’ families or other associates. The benefit may be in addition to, or part of, their employees’ salary or wages package. The FBT is separate from income tax and is calculated on the taxable value of the fringe benefits provided.

In simple terms, FBT is payable when an employee “benefits personally” from an expense reimbursement or when an expense is funded/refunded to a worker by the business and is not directly related to work activities or benefits.

How do expenses need to be documented in Australia?

Expense claims must include a scanned version of the original invoice, receipt, or travel ticket. Each receipt or invoice must also include:

• The date of the purchase
• The name and address of the seller or supplier
• The name and address of the purchaser (in the case of an invoice or ticket)
• The full description of the goods or services

If your supported employee claims an international expense and wishes to claim the rate charged on their credit or debit card, a screenshot of the card statement should be provided for corroboration. 

Can Velocity Global help us provide per diems instead of expenses? Can Velocity Global provide per diems for business travel?

Yes. Velocity Global may pay a per diem rate for supported employees traveling within Australia. These rates are published annually by the Australian Taxation Office (ATO) and vary depending on the location traveled and your supported employee’s salary level. If per diem rates are sought, these require approval before travel. The rates can be found here. 

When traveling outside Australia, your supported employee may submit receipts to claim actual expenses. Alternatively, per diems may be claimed according to the ATO guidelines for the country visited. If per diem rates are sought, these require approval prior to travel. The rates can be found here.