For most Australians, meals and entertainment are not tax deductible. Eating is a private expense, and the ATO does not allow deductions for food consumed during the workday — even if you are working overtime, skipping breaks, or eating at your desk. The exceptions are narrow and specific.
The General Rule — Meals Are Private
The cost of food and drink consumed during a normal work day is private, not work-related. This applies to:
- Breakfast, lunch, and dinner eaten at home or near work
- Coffee and snacks during the workday
- After-work drinks with colleagues
- Team lunches (from your own pocket)
- Client lunches or dinners (as an employee — see below)
When Meals Are Deductible for Employees
Overnight work travel: If you are required to travel away from home overnight for work, meals consumed during that trip are deductible. The meal is a direct result of the work travel placing you away from your normal accommodation.
You cannot claim meals for day trips — only if you are away overnight.
Meal allowance received from employer: If your employer pays you a meal allowance (e.g., shift allowance for overtime meals), include the allowance as income and claim the actual cost of meals purchased. If your actual expense exceeds the allowance, deduct the excess.
The ATO publishes reasonable overtime meal allowance amounts each year. Claims within the reasonable amount do not require receipts — above it, receipts are required.
Business Entertainment — Sole Traders and Companies
For self-employed sole traders and companies, entertainment expenses are subject to the Entertainment Meals provisions in Division 32 of ITAA 1997. The rules are complex:
- Business meals where the primary purpose is entertainment (meals with clients, team dinners, corporate functions) are generally not deductible for income tax purposes
- However, they may be subject to Fringe Benefits Tax (FBT) if provided to employees
- If subject to FBT, an FBT deduction is available — but the FBT is payable
In practice, most business entertainment is not deductible and the FBT rules mean it remains a cost that must be carefully considered.
Working Away — Remote FIFO Workers
FIFO (fly-in fly-out) workers and remote workers whose employers provide food and accommodation at the remote site generally do not pay for those meals themselves. If the employer provides meals as part of the remote arrangement and they appear as income on the income statement, a deduction for the meal costs may be available. This is complex — seek specialist advice.
Frequently Asked Questions
I work 12-hour shifts. Can I claim my meals at work? No. Meals during a shift — however long — are a private expense. The ATO is clear that the duration of your workday does not change the private nature of meal costs.
I buy coffee every day on the way to work. Can I claim it? No. Coffee is a private expense, regardless of where or why you consume it.
I take clients to lunch as part of my sales role. Can I claim it? As an employee, the short answer is generally no. The expense is private — entertainment is not deductible for employees. Some employers may reimburse you and claim the expense through the company’s accounts (with FBT implications). If your employer reimburses you, it is not your deduction.
Can a sole trader ever deduct a client meal? The business meals and entertainment provisions are complex. Some meals with a genuine business purpose (e.g., working meals where work is primarily conducted, not merely social entertainment) may be partially or fully deductible depending on circumstances. A registered tax agent can help structure and document claims appropriately.
This article provides general tax information. For advice tailored to your situation, speak with a registered tax agent. Find one through the Tax Practitioners Board register.