Expense Report Generator

Expense reports in Australia — ATO requirements and best practices

A well-structured expense report is essential for reimbursing employees, claiming tax deductions, and meeting the ATO's record-keeping requirements. Australian businesses must retain receipts and supporting documentation for at least five years — not just the expense report itself, but the original receipts and evidence of business purpose. The ATO's substantiation rules require that work-related or business expense claims be backed by written evidence, including the supplier's name and ABN, the date, the amount, and the nature of the expense.

If your business is registered for GST, you can claim input tax credits for the GST included in most business expenses. The expense report should separate the amount ex-GST from the GST component for each line item, making it straightforward to reconcile against your BAS. Note that some expense categories — such as certain insurance premiums, ATO charges, bank fees, or wages — are GST-free or input-taxed, which is why the GST field should be editable per line.

Meals and entertainment expenses require extra care in Australia. Under the Fringe Benefits Tax Assessment Act 1986, entertainment provided to employees may attract FBT. Motor vehicle reimbursements can be processed via the ATO's cents-per-kilometre rate (88 cents/km for 2024–25), which is generally FBT-exempt but must be documented with kilometres travelled and business purpose. Speak with your accountant if expense reports regularly include entertainment, vehicles, or accommodation to confirm the correct FBT treatment.

How to use this expense report generator

1. Enter the employee's name, department, and the reporting period. Add the manager's name for the approval section.
2. List each expense with the date, category (e.g. travel, meals, accommodation, supplies), a brief description, and the total amount. Set the GST per line based on whether the expense was taxable.
3. Attach or reference supporting receipts for each line. The ATO requires original receipts for substantiation — the expense report alone is not sufficient.
4. Download the PDF, have it approved and signed by the authorising manager, and file it with the supporting receipts for at least five years.

What receipts do I need to keep for ATO substantiation?

For most business expenses, you need a written receipt showing the supplier's name and ABN (where applicable), the date of the transaction, the amount paid, and a description of what was supplied. Receipts under $10 are not individually required if the total for the year from that supplier is under $200. However, for work-related employee deductions over $300, the ATO requires written evidence for every dollar — not just the excess above $300. Digital photos or scans of receipts are acceptable.

Are meal and entertainment expenses tax deductible?

Meal and entertainment expenses are generally not deductible for income tax purposes when they constitute "entertainment" under the ITAA 1997 — even if they are legitimately business-related. However, if the meals are provided on business premises as part of work (e.g. a working lunch in an office meeting), or are subject to FBT, different rules apply. The GST treatment also varies by FBT method chosen. This is a complex area — always confirm with your tax adviser before claiming entertainment expenses.

Can I reimburse employees without an expense report?

Technically you can, but it creates risk. Without a documented expense report and receipts, you have no audit trail to support the deduction or GST claim. If the ATO audits your business, undocumented reimbursements may be disallowed or treated as taxable income to the employee. An approved expense report with receipts is the minimum standard for any reimbursement that involves a tax claim.

How long do expense reports need to be kept?

The ATO requires five years of record retention for business expense documentation, measured from the date the record was created or the date you lodged the relevant tax return — whichever is later. This includes the expense report, the supporting receipts, and any approval records. For FBT purposes, records must be kept for five years from the FBT return lodgement date.