The Goods and Services Tax (GST) is a sales tax of 10% on most goods, services and other items sold or consumed in Australia. You can find all information about GST on ATO’s website. 

Some things don’t have GST included, these are called GST-free sales. This includes basic food, some menstrual products, childcare services, and some medical, health and care services. The complete list is available here. 

In Australia, employers can pay their employees per diem (i.e. daily allowances) as compensation for the expenses (such as maintenance, restaurants and hotels) incurred while they are on a business trip. 

Per diems are not considered part of an employee’s income and are thus tax-free if they are following the ATO’s maximum amounts. These maximum amounts reflect what the ATO has determined as reasonable. These rates are reviewed at the start of each income year (1 July). 

 Employees need to keep records of their travel expenses.

The ATO determines reasonable amounts for these allowances. These ‘reasonable’ amounts are reviewed at the start of each income year (1 July). 

‘Reasonable’ allowances received in accordance with ATO’s reasonable travel allowances schedules are not required to be declared as income and can be excluded from the expense substantiation requirements. 

The 2025-26 reasonable amount for overtime ATO meal allowance is $38.65. 

Reasonable amounts given for meals for truck drivers (domestic travel) are as follows: 

• Breakfast $31.15 
• Lunch $35.55 
• Dinner $61.30 

More information can be found here. 

A mileage allowance is a payment provided by the employer to employees for using their personal vehicle for work purposes.

In Australia, mileage reimbursement covers trips between workplaces or to perform your work duties. This does not include trips between the employee’s home and place of work, except in limited circumstances. 

To claim a deduction for car expenses: 

• The vehicle must meet the definition of a car. 
• The employee must own or lease the car. 
• The expenses must be for work-related trips. 

Reimbursement per kilometre

There is a maximum amount that employers can reimburse tax-free. This maximum amount is defined by the ATO and reviewed at the start of each income year. 

Employers can choose to pay more than these amounts; however, the excess will then be considered taxable income. If you pay less than these amounts, the reimbursement is tax-free.