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What Are Transportation Expenses?

  • How They Work

Special Considerations

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Transportation Expenses: Definition, How They Work, and Taxation

Adam Hayes, Ph.D., CFA, is a financial writer with 15+ years Wall Street experience as a derivatives trader. Besides his extensive derivative trading expertise, Adam is an expert in economics and behavioral finance. Adam received his master's in economics from The New School for Social Research and his Ph.D. from the University of Wisconsin-Madison in sociology. He is a CFA charterholder as well as holding FINRA Series 7, 55 & 63 licenses. He currently researches and teaches economic sociology and the social studies of finance at the Hebrew University in Jerusalem.

travelling expenses define

Thomas J Catalano is a CFP and Registered Investment Adviser with the state of South Carolina, where he launched his own financial advisory firm in 2018. Thomas' experience gives him expertise in a variety of areas including investments, retirement, insurance, and financial planning.

travelling expenses define

June Wachira / Getty Images

The term transportation expense refers to specific costs incurred by an employee or self-employed taxpayer who travels for business purposes. Transportation expenses are a subset of travel expenses, which include all of the costs associated with business travel such as taxi fare, fuel, parking fees, lodging, meals, tips, cleaning, shipping, and telephone charges that employees may incur and claim for reimbursement from their employers. Some transportation expenses may be eligible for a tax deduction on an employee's tax return .

Key Takeaways

  • Transportation expenses are a subset of travel expenses that refer specifically to the cost of business transportation by car, plane, train, etc.
  • Expenses such as fuel, parking fees, lodging, meals, and telephone charges incurred by employees can be claimed as transportation expenses.
  • These expenses may be deducted for tax purposes subject to the appropriate restrictions and guidelines.

How Transportation Expenses Work

Transportation expenses are any costs related to business travel by company employees. An employee who travels for a business trip is generally able to claim the cost of travel, hotel, food, and any other related expense as a transportation expense. These costs may also include those associated with traveling to a temporary workplace from home under some circumstances. For instance, an employee whose travel area is not limited to their tax home can generally claim that travel as a transportation expense.

These expenses, though, are narrower in scope. They only refer to the use of or cost of maintaining a car used for business or transport by rail, air, bus, taxi, or any other means of conveyance for business purposes. These expenses may also refer to deductions for businesses and self-employed individuals when filing tax returns . Commuting to and from the office, however, does not count as a transportation expense.

The cost of commuting is not considered a deductible transportation expense.

Transportation expenses may only qualify for tax deductions if they are directly related to the primary business for which an individual works. For example, if a traveler works in the same business or trade at one or more regular work locations that are away from home such as a construction worker, it is considered a transportation expense.

Similarly, if a traveler has no set workplace but mostly works in the same metropolitan area they live in, they may claim a travel expense if they travel to a worksite outside of their metro area. On the other hand, claiming transportation costs when you have not actually done any traveling for the business is not allowed and can be viewed as a form of tax fraud .

Taxpayers must keep good records in order to claim travel expenses. Receipts and other evidence must be submitted when claiming travel-related reimbursable or tax-deductible expenses.

According to the Internal Revenue Service (IRS) travel or transportation expenses are defined as being: "...the ordinary and necessary expenses of traveling away from home for your business, profession, or job." And it further defines "traveling away from home" as duties that "...require you to be away from the general area of your tax home substantially longer than an ordinary day's work, and you need to sleep or rest to meet the demands of your work while away from home."

The IRS provides guidelines for transportation expenses, deductibility, depreciation, conditions, exceptions , reimbursement rates, and more in Publication 463 . The publication sets the per-mile reimbursement rate for operating your personal car for business. Travelers who use their vehicles for work can claim 58.5 cents per mile for the 2022 tax year , increasing to 62.5 cents for the remaining six months. That's up from 56 cents eligible for 2021. The IRS' determined rate treated as  depreciation  for the business standard mileage is 26 cents as of Jan. 1, 2021.

Internal Revenue Service. " Topic No. 511 Business Travel Expenses ."

Internal Revenue Service. " 2022 Standard Mileage Rates ," Pages 3-4.

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Travel Expenses Definition And Tax Deductible Categories

Travel Expenses Definition And Tax Deductible Categories

Published: February 11, 2024

Learn about travel expenses, their definition, and tax deductible categories in finance. Maximize your tax deductions and save money while traveling.

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(Many of the links in this article redirect to a specific reviewed product. Your purchase of these products through affiliate links helps to generate commission for LiveWell, at no extra cost. Learn more )

Maximizing Your Travel Expenses: A Guide to Tax Deductible Categories

Are you a frequent traveler who wants to make the most out of your travel expenses? Or maybe you’re a business owner looking to understand the tax deductible categories related to travel. Either way, you’ve come to the right place! In this article, we will explore the definition of travel expenses and discuss the various categories that may be eligible for tax deductions. So, let’s dive in and discover how you can optimize your finances while enjoying your travels!

Key Takeaways:

  • Understanding the definition of travel expenses is crucial for maximizing your tax deductions.
  • Know the tax deductible categories to ensure you claim all eligible expenses.

Defining Travel Expenses

Travel expenses, in a broad sense, refer to the costs associated with a trip taken for business, work, or investment purposes. These expenses can include transportation, lodging, meals, entertainment, and other incidental expenses. However, it’s important to note that not all travel-related expenses are tax deductible.

When it comes to tax deductions, the IRS requires that your travel expenses meet certain criteria. Generally, the expenses must be necessary, ordinary, directly related to your business or work, and proper and appropriate in the context of your profession. It’s always a good idea to consult with a tax professional to ensure you meet all the necessary requirements.

Tax Deductible Categories for Travel Expenses

1. Transportation Expenses:

Transportation costs usually comprise a significant portion of travel expenses. These can include airfare, train or bus tickets, rental car fees, taxi fares, and even parking fees. Keep in mind that personal expenses unrelated to your business or work are not considered tax deductible.

2. Lodging Expenses:

When traveling for business, your accommodations can be tax deductible. This includes hotel stays or rental expenses for apartments or houses. However, if you combine business travel with personal vacations, only the expenses directly related to your business activities are eligible for tax deductions.

3. Meal Expenses:

The cost of meals during your business travel can also be tax deductible, but be mindful of the regulations set forth by the IRS. Generally, meals must be directly related to the active conduct of your business, with only 50% of the cost being eligible for deduction. Remember to keep receipts and make note of the business purpose of each meal.

4. Entertainment Expenses:

In certain circumstances, entertainment expenses incurred during your business travel can be tax deductible. These expenses typically include entertaining clients or customers, attending conferences or trade shows, and networking events. As with meals, it’s important to maintain documentation such as receipts and details of the business purpose for each expense.

5. Incidental Expenses:

Incidental expenses refer to smaller costs incurred during your travel, such as tips, baggage fees, and laundry expenses. Though they may seem insignificant, these expenses can add up over time. By keeping track of them and ensuring they are directly related to your business activities, you can potentially claim them as tax deductions.

The Bottom Line

Understanding the categories of tax-deductible travel expenses is crucial for optimizing your finances. By familiarizing yourself with these categories and maintaining proper documentation, you can ensure that you claim all eligible expenses and maximize your tax deductions.

Remember, consulting with a tax professional is always a wise decision to ensure compliance with the ever-changing regulations. So, go ahead and explore the world while making the most of your travel expenses with these tax deductible categories!

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How to Deduct Travel Expenses (with Examples)

Reviewed by

November 3, 2022

This article is Tax Professional approved

Good news: most of the regular costs of business travel are tax deductible.

Even better news: as long as the trip is primarily for business, you can tack on a few vacation days and still deduct the trip from your taxes (in good conscience).

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Even though we advise against exploiting this deduction, we do want you to understand how to leverage the process to save on your taxes, and get some R&R while you’re at it.

Follow the steps in this guide to exactly what qualifies as a travel expense, and how to not cross the line.

The travel needs to qualify as a “business trip”

Unfortunately, you can’t just jump on the next plane to the Bahamas and write the trip off as one giant business expense. To write off travel expenses, the IRS requires that the primary purpose of the trip needs to be for business purposes.

Here’s how to make sure your travel qualifies as a business trip.

1. You need to leave your tax home

Your tax home is the locale where your business is based. Traveling for work isn’t technically a “business trip” until you leave your tax home for longer than a normal work day, with the intention of doing business in another location.

2. Your trip must consist “mostly” of business

The IRS measures your time away in days. For a getaway to qualify as a business trip, you need to spend the majority of your trip doing business.

For example, say you go away for a week (seven days). You spend five days meeting with clients, and a couple of days lounging on the beach. That qualifies as business trip.

But if you spend three days meeting with clients, and four days on the beach? That’s a vacation. Luckily, the days that you travel to and from your location are counted as work days.

3. The trip needs to be an “ordinary and necessary” expense

“Ordinary and necessary ” is a term used by the IRS to designate expenses that are “ordinary” for a business, given the industry it’s in, and “necessary” for the sake of carrying out business activities.

If there are two virtually identical conferences taking place—one in Honolulu, the other in your hometown—you can’t write off an all-expense-paid trip to Hawaii.

Likewise, if you need to rent a car to get around, you’ll have trouble writing off the cost of a Range Rover if a Toyota Camry will get you there just as fast.

What qualifies as “ordinary and necessary” can seem like a gray area at times, and you may be tempted to fudge it. Our advice: err on the side of caution. if the IRS chooses to investigate and discovers you’ve claimed an expense that wasn’t necessary for conducting business, you could face serious penalties .

4. You need to plan the trip in advance

You can’t show up at Universal Studios , hand out business cards to everyone you meet in line for the roller coaster, call it “networking,” and deduct the cost of the trip from your taxes. A business trip needs to be planned in advance.

Before your trip, plan where you’ll be each day, when, and outline who you’ll spend it with. Document your plans in writing before you leave. If possible, email a copy to someone so it gets a timestamp. This helps prove that there was professional intent behind your trip.

The rules are different when you travel outside the United States

Business travel rules are slightly relaxed when you travel abroad.

If you travel outside the USA for more than a week (seven consecutive days, not counting the day you depart the United States):

You must spend at least 75% of your time outside of the country conducting business for the entire getaway to qualify as a business trip.

If you travel outside the USA for more than a week, but spend less than 75% of your time doing business, you can still deduct travel costs proportional to how much time you do spend working during the trip.

For example, say you go on an eight-day international trip. If you spend at least six days conducting business, you can deduct the entire cost of the trip as a business expense—because 6 is equivalent to 75% of your time away, which, remember, is the minimum you must spend on business in order for the entire trip to qualify as a deductible business expense.

But if you only spend four days out of the eight-day trip conducting business—or just 50% of your time away—you would only be able to deduct 50% of the cost of your travel expenses, because the trip no longer qualifies as entirely for business.

List of travel expenses

Here are some examples of business travel deductions you can claim:

  • Plane, train, and bus tickets between your home and your business destination
  • Baggage fees
  • Laundry and dry cleaning during your trip
  • Rental car costs
  • Hotel and Airbnb costs
  • 50% of eligible business meals
  • 50% of meals while traveling to and from your destination

On a business trip, you can deduct 100% of the cost of travel to your destination, whether that’s a plane, train, or bus ticket. If you rent a car to get there, and to get around, that cost is deductible, too.

The cost of your lodging is tax deductible. You can also potentially deduct the cost of lodging on the days when you’re not conducting business, but it depends on how you schedule your trip. The trick is to wedge “vacation days” in between work days.

Here’s a sample itinerary to explain how this works:

Thursday: Fly to Durham, NC. Friday: Meet with clients. Saturday: Intermediate line dancing lessons. Sunday: Advanced line dancing lessons. Monday: Meet with clients. Tuesday: Fly home.

Thursday and Tuesday are travel days (remember: travel days on business trips count as work days). And Friday and Monday, you’ll be conducting business.

It wouldn’t make sense to fly home for the weekend (your non-work days), only to fly back into Durham for your business meetings on Monday morning.

So, since you’re technically staying in Durham on Saturday and Sunday, between the days when you’ll be conducting business, the total cost of your lodging on the trip is tax deductible, even if you aren’t actually doing any work on the weekend.

It’s not your fault that your client meetings are happening in Durham—the unofficial line dancing capital of America .

Meals and entertainment during your stay

Even on a business trip, you can only deduct a portion of the meal and entertainment expenses that specifically facilitate business. So, if you’re in Louisiana closing a deal over some alligator nuggets, you can write off 50% of the bill.

Just make sure you make a note on the receipt, or in your expense-tracking app , about the nature of the meeting you conducted—who you met with, when, and what you discussed.

On the other hand, if you’re sampling the local cuisine and there’s no clear business justification for doing so, you’ll have to pay for the meal out of your own pocket.

Meals and entertainment while you travel

While you are traveling to the destination where you’re doing business, the meals you eat along the way can be deducted by 50% as business expenses.

This could be your chance to sample local delicacies and write them off on your tax return. Just make sure your tastes aren’t too extravagant. Just like any deductible business expense, the meals must remain “ordinary and necessary” for conducting business.

How Bench can help

Surprised at the kinds of expenses that are tax-deductible? Travel expenses are just one of many unexpected deductible costs that can reduce your tax bill. But with messy or incomplete financials, you can miss these tax saving expenses and end up with a bigger bill than necessary.

Enter Bench, America’s largest bookkeeping service. With a Bench subscription, your team of bookkeepers imports every transaction from your bank, credit cards, and merchant processors, accurately categorizing each and reviewing for hidden tax deductions. We provide you with complete and up-to-date bookkeeping, guaranteeing that you won’t miss a single opportunity to save.

Want to talk taxes with a professional? With a premium subscription, you get access to unlimited, on-demand consultations with our tax professionals. They can help you identify deductions, find unexpected opportunities for savings, and ensure you’re paying the smallest possible tax bill. Learn more .

Bringing friends & family on a business trip

Don’t feel like spending the vacation portion of your business trip all alone? While you can’t directly deduct the expense of bringing friends and family on business trips, some costs can be offset indirectly.

Driving to your destination

Have three or four empty seats in your car? Feel free to fill them. As long as you’re traveling for business, and renting a vehicle is a “necessary and ordinary” expense, you can still deduct your business mileage or car rental costs even when others join you for the ride.

One exception: If you incur extra mileage or “unnecessary” rental costs because you bring your family along for the ride, the expense is no longer deductible because it isn’t “necessary or ordinary.”

For example, let’s say you had to rent an extra large van to bring your children on a business trip. If you wouldn’t have needed to rent the same vehicle to travel alone, the expense of the extra large van no longer qualifies as a business deduction.

Renting a place to stay

Similar to the driving expense, you can only deduct lodging equivalent to what you would use if you were travelling alone.

However, there is some flexibility. If you pay for lodging to accommodate you and your family, you can deduct the portion of lodging costs that is equivalent to what you would pay only for yourself .

For example, let’s say a hotel room for one person costs $100, but a hotel room that can accommodate your family costs $150. You can rent the $150 option and deduct $100 of the cost as a business expense—because $100 is how much you’d be paying if you were staying there alone.

This deduction has the potential to save you a lot of money on accommodation for your family. Just make sure you hold on to receipts and records that state the prices of different rooms, in case you need to justify the expense to the IRS

Heads up. When it comes to AirBnB, the lines get blurry. It’s easy to compare the cost of a hotel room with one bed to a hotel room with two beds. But when you’re comparing significantly different lodgings, with different owners—a pool house versus a condo, for example—it becomes hard to justify deductions. Sticking to “traditional” lodging like hotels and motels may help you avoid scrutiny during an audit. And when in doubt: ask your tax advisor.

So your trip is technically a vacation? You can still claim any business-related expenses

The moment your getaway crosses the line from “business trip” to “vacation” (e.g. you spend more days toasting your buns than closing deals) you can no longer deduct business travel expenses.

Generally, a “vacation” is:

  • A trip where you don’t spend the majority of your days doing business
  • A business trip you can’t back up with correct documentation

However, you can still deduct regular business-related expenses if you happen to conduct business while you’re on vacay.

For example, say you visit Portland for fun, and one of your clients also lives in that city. You have a lunch meeting with your client while you’re in town. Because the lunch is business related, you can write off 50% of the cost of the meal, the same way you would any other business meal and entertainment expense . Just make sure you keep the receipt.

Meanwhile, the other “vacation” related expenses that made it possible to meet with this client in person—plane tickets to Portland, vehicle rental so you could drive around the city—cannot be deducted; the trip is still a vacation.

If your business travel is with your own vehicle

There are two ways to deduct business travel expenses when you’re using your own vehicle.

  • Actual expenses method
  • Standard mileage rate method

Actual expenses is where you total up the actual cost associated with using your vehicle (gas, insurance, new tires, parking fees, parking tickets while visiting a client etc.) and multiply it by the percentage of time you used it for business. If it was 50% for business during the tax year, you’d multiply your total car costs by 50%, and that’d be the amount you deduct.

Standard mileage is where you keep track of the business miles you drove during the tax year, and then you claim the standard mileage rate .

The cost of breaking the rules

Don’t bother trying to claim a business trip unless you have the paperwork to back it up. Use an app like Expensify to track business expenditure (especially when you travel for work) and master the art of small business recordkeeping .

If you claim eligible write offs and maintain proper documentation, you should have all of the records you need to justify your deductions during a tax audit.

Speaking of which, if your business is flagged to be audited, the IRS will make it a goal to notify you by mail as soon as possible after your filing. Usually, this is within two years of the date for which you’ve filed. However, the IRS reserves the right to go as far back as six years.

Tax penalties for disallowed business expense deductions

If you’re caught claiming a deduction you don’t qualify for, which helped you pay substantially less income tax than you should have, you’ll be penalized. In this case, “substantially less” means the equivalent of a difference of 10% of what you should have paid, or $5,000—whichever amount is higher.

The penalty is typically 20% of the difference between what you should have paid and what you actually paid in income tax. This is on top of making up the difference.

Ultimately, you’re paying back 120% of what you cheated off the IRS.

If you’re slightly confused at this point, don’t stress. Here’s an example to show you how this works:

Suppose you would normally pay $30,000 income tax. But because of a deduction you claimed, you only pay $29,000 income tax.

If the IRS determines that the deduction you claimed is illegitimate, you’ll have to pay the IRS $1200. That’s $1000 to make up the difference, and $200 for the penalty.

Form 8275 can help you avoid tax penalties

If you think a tax deduction may be challenged by the IRS, there’s a way you can file it while avoiding any chance of being penalized.

File Form 8275 along with your tax return. This form gives you the chance to highlight and explain the deduction in detail.

In the event you’re audited and the deduction you’ve listed on Form 8275 turns out to be illegitimate, you’ll still have to pay the difference to make up for what you should have paid in income tax—but you’ll be saved the 20% penalty.

Unfortunately, filing Form 8275 doesn’t reduce your chances of being audited.

Where to claim travel expenses

If you’re self-employed, you’ll claim travel expenses on Schedule C , which is part of Form 1040.

When it comes to taking advantage of the tax write-offs we’ve discussed in this article—or any tax write-offs, for that matter—the support of a professional bookkeeping team and a trusted CPA is essential.

Accurate financial statements will help you understand cash flow and track deductible expenses. And beyond filing your taxes, a CPA can spot deductions you may have overlooked, and represent you during a tax audit.

Learn more about how to find, hire, and work with an accountant . And when you’re ready to outsource your bookkeeping, try Bench .

Join over 140,000 fellow entrepreneurs who receive expert advice for their small business finances

Get a regular dose of educational guides and resources curated from the experts at Bench to help you confidently make the right decisions to grow your business. No spam. Unsubscribe at any time.

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Everything You Need to Know About the Business Travel Tax Deduction

Justin W. Jones, EA, JD

Justin is an IRS Enrolled Agent, allowing him to represent taxpayers before the IRS. He loves helping freelancers and small business owners save on taxes. He is also an attorney and works part-time with the Keeper Tax team.

You don’t have to fly first class and stay at a fancy hotel to claim travel expense tax deductions. Conferences, worksite visits, and even a change of scenery can (sometimes) qualify as business travel.

What counts as business travel?

The IRS does have a few simple guidelines for determining what counts as business travel. Your trip has to be:

  • Mostly business
  • An “ordinary and necessary” expense
  • Someplace far away from your “tax home”

What counts as "mostly business"?

The IRS will measure your time away in days. If you spend more days doing business activities than not, your trip is considered "mostly business". Your travel days are counted as work days.

Special rules for traveling abroad

If you are traveling abroad for business purposes, you trip counts as " entirely for business " as long as you spend less than 25% of your time on personal activities (like vacationing). Your travel days count as work days.

So say you you head off to Zurich for nine days. You've got a seven-day run of conference talks, client meetings, and the travel it takes to get you there. You then tack on two days skiing on the nearby slopes.

Good news: Your trip still counts as "entirely for business." That's because two out of nine days is less than 25%.

What is an “ordinary and necessary” expense?

“Ordinary and necessary” means that the trip:

  • Makes sense given your industry, and
  • Was taken for the purpose of carrying out business activities

If you have a choice between two conferences — one in your hometown, and one in London — the British one wouldn’t be an ordinary and necessary expense.

What is your tax home?

A taxpayer can deduct travel expenses anytime you are traveling away from home but depending on where you work the IRS definition of “home” can get complicated.

Your tax home is often — but not always — where you live with your family (what the IRS calls your "family home"). When it comes to defining it, there are two factors to consider:

  • What's your main place of business, and
  • How large is your tax home

What's your main place of business?

If your main place of business is somewhere other than your family home, your tax home will be the former — where you work, not where your family lives.

For example, say you:

  • Live with your family in Chicago, but
  • Work in Milwaukee during the week (where you stay in hotels and eat in restaurants)

Then your tax home is Milwaukee. That's your main place of business, even if you travel back to your family home every weekend.

How large is your tax home?

In most cases, your tax home is the entire city or general area where your main place of business is located.

The “entire city” is easy to define but “general area” gets a bit tricker. For example, if you live in a rural area, then your general area may span several counties during a regular work week.

Rules for business travel

Want to check if your trip is tax-deductible? Make sure it follows these rules set by the IRS.

1. Your trip should take you away from your home base

A good rule of thumb is 100 miles. That’s about a two hour drive, or any kind of plane ride. To be able to claim all the possible travel deductions, your trip should require you to sleep somewhere that isn’t your home.

2. You should be working regular hours

In general, that means eight hours a day of work-related activity.

It’s fine to take personal time in the evenings, and you can still take weekends off. But you can’t take a half-hour call from Disneyland and call it a business trip.

Here's an example. Let’s say you’re a real estate agent living in Chicago. You travel to an industry conference in Las Vegas. You go to the conference during the day, go out in the evenings, and then stay the weekend. That’s a business trip!

3. The trip should last less than a year

Once you’ve been somewhere for over a year, you’re essentially living there. However, traveling for six months at a time is fine!

For example, say you’re a freelancer on Upwork, living in Seattle. You go down to stay with your sister in San Diego for the winter to expand your client network, and you work regular hours while you’re there. That counts as business travel.

What about digital nomads?

With the rise of remote-first workplaces, many freelancers choose to take their work with them as they travel the globe. There are a couple of requirements these expats have to meet if they want to write off travel costs.

Requirement #1: A tax home

Digital nomads have to be able to claim a particular foreign city as a tax home if they want to write off any travel expenses. You don't have to be there all the time — but it should be your professional home base when you're abroad.

For example, say you've rent a room or a studio apartment in Prague for the year. You regularly call clients and finish projects from there. You still travel a lot, for both work and play. But Prague is your tax home, so you can write off travel expenses.

Requirement #2: Some work-related reason for traveling

As long as you've got a tax home and some work-related reason for traveling, these excursion count as business trips. Plausible reasons include meeting with local clients, or attending a local conference and then extending your stay.

However, if you’re a freelance software developer working from Thailand because you like the weather, that unfortunately doesn't count as business travel.

The travel expenses you can write off

As a rule of thumb, all travel-related expenses on a business trip are tax-deductible. You can also claim meals while traveling, but be careful with entertainment expenses (like going out for drinks!).

Here are some common travel-related write-offs you can take.

🛫 All transportation

Any transportation costs are a travel tax deduction. This includes traveling by airplane, train, bus, or car. Baggage fees are deductible, and so are Uber rides to and from the airport.

Just remember: if a client is comping your airfare, or if you booked your ticket with frequent flier miles, then it isn't deductible since your cost was $0.

If you rent a car to go on a business trip, that rental is tax-deductible. If you drive your own vehicle, you can either take actual costs or use the standard mileage deduction. There's more info on that in our guide to deducting car expenses .

Hotels, motels, Airbnb stays, sublets on Craigslist, even reimbursing a friend for crashing on their couch: all of these are tax-deductible lodging expenses.

🥡 Meals while traveling

If your trip has you staying overnight — or even crashing somewhere for a few hours before you can head back — you can write off food expenses. Grabbing a burger alone or a coffee at your airport terminal counts! Even groceries and takeout are tax-deductible.

One important thing to keep in mind: You can usually deduct 50% of your meal costs. For 2021 and 2022, meals you get at restaurants are 100% tax-deductible. Go to the grocery store, though, and you’re limited to the usual 50%.

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🌐 Wi-Fi and communications

Wi-Fi — on a plane or at your hotel — is completely deductible when you’re traveling for work. This also goes for other communication expenses, like hotspots and international calls.

If you need to ship things as part of your trip — think conference booth materials or extra clothes — those expenses are also tax-deductible.

👔 Dry cleaning

Need to look your best on the trip? You can write off related expenses, like laundry charges.

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Travel expenses you can't deduct

Some travel costs may seem like no-brainers, but they're not actually tax-deductible. Here are a couple of common ones to watch our for.

The cost of bringing your child or spouse

If you bring your child or spouse on a business trip, your travel expense deductions get a little trickier. In general, the cost of bring other people on a business trip is considered personal expense — which means it's not deductible.

You can only deduct travel expenses if your child or spouse:

  • Is an employee,
  • Has a bona fide business purpose for traveling with you, and
  • Would otherwise be allowed to deduct the travel expense on their own

Some hotel bill charges

Staying in a hotel may be required for travel purposes. That's why the room charge and taxes are deductible.

Some additional charges, though, won't qualify. Here are some examples of fees that aren't tax-deductible:

  • Gym or fitness center fees
  • Movie rental fees
  • Game rental fees

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Where to claim travel expenses when filing your taxes

If you are self-employed, you will claim all your income tax deduction on the Schedule C. This is part of the Form 1040 that self-employed people complete ever year.

What happens if your business deductions are disallowed?

If the IRS challenges your business deduction and they are disallowed, there are potential penalties. This can happen if:

  • The deduction was not legitimate and shouldn't have been claimed in the first place, or
  • The deduction was legitimate, but you don't have the documentation to support it

When does the penalty come into play?

The 20% penalty is not automatic. It only applies if it allowed you to pay substantially less taxes than you normally would. In most cases, the IRS considers “substantially less” to mean you paid at least 10% less.

In practice, you would only reach this 10% threshold if the IRS disqualified a significant number of your travel deductions.

How much is the penalty?

The penalty is normally 20% of the difference between what you should have paid and what you actually paid. You also have to make up the original difference.

In total, this means you will be paying 120% of your original tax obligation: your original obligation, plus 20% penalty.

Justin W. Jones, EA, JD

Justin W. Jones, EA, JD

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7 Rules You Should Know About Deducting Business Travel Expenses

travelling expenses define

  • What Is Your "Tax Home"?

Charges on Your Hotel Bill

The 50% rule for meals, the cost of bringing a spouse, friend or employee.

  • Using Per Diems To Calculate Employee Travel Costs

Combined Business/Personal Trips

International business travel.

  • The Cost of a Cruise (Within Limits)

Frequently Asked Questions (FAQs)

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The IRS has a specific definition for business travel when it comes to determining whether these expenses are tax deductible. The agency says business travel is travel that takes you away from your tax home and is "substantially longer than an ordinary day's work." It requires that you sleep or rest while you're away from home, and that you do so. The travel must be "temporary." This means it can't last a year or more.

Key Takeaways

  • You can deduct expenses that take you away from your tax home for a period of time that would require you to spend the night.
  • Your tax home is the city or area where your regular place of business is located.
  • You’re limited to 50% of the cost of your meals.
  • Your trip must be entirely business-related for costs to be deductible, but special rules apply if you travel outside the U.S.

What Is Your "Tax Home"?

Your tax home is a concept set by the IRS to help determine whether a trip is tax deductible. It's defined by the IRS as the entire city or general area where your regular place of business is located. It's not necessarily the area where you live. 

Your tax home can be used to determine whether your business travel expenses are deductible after you've determined where it's located. You can probably count your expenses during travel as business deductions if you have to leave your tax home overnight or if you otherwise need time to rest and sleep while you're away.

Check with a tax professional to make sure you're accurately identifying the location of your tax home.

Charges for your room and associated tax are deductible, as are laundry expenses and charges for phone calls or for use of a fax machine. Tips are deductible as well. But additional personal charges, such as gym fees or fees for movies or games aren't deductible.

You can deduct the cost of meals while you're traveling, but entertainment expenses are no longer deductible and you can't deduct "lavish or extravagant" meals. 

Meal costs are deductible at 50%. The 50% limit also applies to taxes and tips. You can use either your actual costs or a standard meal allowance to take a meal cost deduction, as long as it doesn't exceed the 50% limit.

The cost of bringing a spouse, child, or anyone else along on a business trip is considered a personal expense and isn't deductible. But you may be able to deduct travel expenses for the individual if:

  • The person is an employee
  • They have a bona fide business purpose for traveling with you
  • They would otherwise be allowed to deduct travel expenses

You may be able to deduct the cost of a companion's travel if you can prove that the other person is employed by the business and is performing substantial business-related tasks while on the trip. This may include taking minutes at meetings or meeting with business clients.

Using Per Diems To Calculate Employee Travel Costs 

The term "per diem" means "per day." Per diems are amounts that are considered reasonable for daily meals and miscellaneous expenses while traveling. 

Per diem rates are set for U.S. and overseas travel, and the rates differ depending on the area. They're higher in larger U.S. cities than for sections of the country outside larger metropolitan areas. Companies can set their own per diem rates, but most businesses use the rates set by the U.S. government.

Per diem reimbursements aren't taxable unless they're greater than the maximum rate set by the General Service Administration. The excess is taxable to the employee.

If you don't spend all your time on business activities during an international trip, you can only deduct the business portion of getting to and from the destination. You must allocate costs between business and personal activities.

Your trip must be entirely business-related for you to take deductions for travel costs if you remain in the U.S., but some "incidental" personal time is okay. It would be incidental to the main purpose of your trip if you travel to Dallas for business and you spend an evening with family in the area while you're there. 

But attempting to turn a personal trip into a business trip won't work unless the trip is substantially for business purposes. The IRS indicates that “the scheduling of incidental business activities during a trip, such as viewing videotapes or attending lectures dealing with general subjects, will not change what is really a vacation into a business trip."

The rules are different if part or all of your trip takes you outside the U.S. Your international travel may be considered business-related if you were outside the U.S. for more than a week and less than 25% of the time was spent on personal activities. 

You can deduct the costs of your entire trip if it takes you outside the U.S. and you spend the entire time on business activities, but you must have "substantial control" over the itinerary. An employee traveling with you wouldn't have control over the trip, but you would as the business owner would.

 The trip may be considered entirely for business if you spend less than 25% of the time on personal activities if your trip takes you outside the U.S. for more than a week.

You can only deduct the business portion of getting to and from the destination if you don't spend all your time on business activities during an international trip. You must allocate costs between your business and personal activities.

The Cost of a Cruise (Within Limits) 

The cost of a cruise may be deductible up to the specified limit determined by the IRS, which is $2,000 per year as of 2022.  You must be able to show that the cruise was directly related to a business event, such as a business meeting or board of directors meeting.

The IRS imposes specific additional strict requirements for deducting cruise travel as a business expense.

How do you write off business travel expenses?

Business travel expenses are entered on Schedule C if you're self-employed . The schedule is filed along with your Form 1040 tax return. It lists all your business income, then you can subtract the cost of your business travel and other business deductions you qualify for to arrive at your taxable income.

What are standard business travel expenses?

Standard business travel expenses include lodging, food, transportation costs , shipping of baggage and/or work items, laundry and dry cleaning, communication costs, and tips. But numerous rules apply so check with a tax professional before you claim them.

The Bottom Line

These tax deduction regulations are complicated, and there are many qualifications and exceptions. Consult with your tax and legal professionals before taking actions that could affect your business. 

IRS. " Topic No. 511: Business Travel Expenses ."

IRS. " Publication 463 (2021), Travel, Gift, and Car Expenses ."

IRS. " Here’s What Taxpayers Need To Know About Business-Related Travel Deductions ."

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Audit and Accounting Solutions

Travelling Expenses – Meaning, Examples and Journal Entries

March 17, 2022 Runner

The name itself indicates that this travelling expense relates to expenses incurred for travel by entity employees or directors. The purpose of travel shall be connecting to the entity’s business operations. Therefore, the purpose shall not be of personal nature.

Estimated reading time: 5 minutes

Travelling expenses

Travelling expenses Examples:

Let’s see a couple of instances relating to travelling expenses

  • Directors Cost of travel to other City to attend some business meeting or Client meeting
  • Cab Expenses (Local Travel)
  • Air Fare and insurance charges, if any relating to the business travel
  • Expenses incurred for the Meals, Communication charges and WIFI Charges
  • Tips or Surcharge paid for using any of the above facilities as part of travel
  • Parking Fees, Toll Charges, Cab Waiting Charges and Luggage Porter Charges

What’s the Journal Entry?

Travelling expenses is a Nominal Account that flows into the Profit and Loss A/c. As this GL is an expenditure Account, the appropriate accounting treatment is to debit this GL Account in the Journal Entry .

Let’s see what’s the corresponding Credit.

Credit is for the Liability Account. Here Liability Account is named Cab Charges Payable, Travel Charges Payable etc., based on the nature of the liability.

There might be instances where there is no requirement to recognize the liability like Meals, tips, parking fees etc. These expenditures are paid immediately, and there might not be any bills or invoices. So, the Credit, in this case, is the Cash A/c.

Journal Entry for recording the Travelling expenses:

Travelling Expense JE 1

(Being the travel charges incurred for ABC Manufacturing deal)

Travel Charges Payment JE

(Being the travel charges paid)

Frequently Asked Questions

1) are the travelling expenses of a salesman forms part of direct or indirect expenses.

The category of expenses depends on the nature of the entity’s business.

For Entities exclusively into the Marketing/Product Sales (not manufacturing), the Travel expense of a Salesman is a direct expense. That’s because those expenditures drive the business operations of the entity.

For Entities not falling into the above category, those travel expenses fall into the Marketing Expenses category, which is an indirect expense. Therefore, it depends on the business category in which the entity operates.

2) What does Accommodation expenses mean?

Accommodation Expenses are the expenses relating to hotel or motel stay. These expenses include the Food, Laundry Service, Telephone, Internet expenses, GST and Service Charges. So, these Accommodation expenses are part of travel expenses. Therefore, it qualifies for indirect business expenditure.

The thumb rule here is to check whether the accommodation expenses shall be relatable to the business operations. So, emphasis shall be given to business importance of the expenses.

3) Paid for travelling expenses journal entry:

Paid for Travelling expenses journal entry records the cash/bank payment done for the travel and related expenses incurred for the business purpose. Let’s see the nature of accounts and accounting rules applicable.

Accounts Involved – Travelling expense and Bank Account

Nature of Accounts –

Travelling Expenses is a Nominal A/c – Expenditure and Bank Account is Real A/c – Asset

Accounting Rules:

The Golden rules of accounting applicable in this scenario are below.

Nominal Account: Debit the expenses and Losses Credit the gains and incomes and

Real Account – Debit what comes in and Credit what goes out

Paid for travelling expenses journal entry is

Travelling expenses A/c Dr

To Bank A/c

4) Travelling expenses are debited to which GL account?

There are no rules for the Naming of an Account. The GL Description shall depict the nature of the Account. For example, if the GL relates to telephone expenses, it shall not fall into conveyance expenses. Therefore, the travelling expenses GL is used as a debit to record the travel expenses in general.

Conclusion:

Travelling expenses are the expenses incurred in relation to business travel . The purpose shall not be in a personal nature. The thumb rules are to check if those expenses help further business operations. This travel expenses category is wide enough to cover the accommodation charges, telephone, internet charges, ancillary charges incurred along with the hotel expenditure.

Debit the Travelling expense and Credit the Bank Account to record the Journal Entry. If the transaction happens on a credit basis, two entries are recorded. The first one is to debit the travelling expense, and the Credit is to the Liability Account. The second entry is to debit the Liability account and Credit the bank account. The net effect is knocking off the Liability Credit in the first entry and the Liability debit in the second. So, technically the journal entry is the same as the first scenario. It’s just deferment of recording the complete transaction effect.

Hope this article brings some clarity on the travelling expenses concept. If you have any questions then pls let us know through the comments below.

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Travel Expenses

travelling expenses define

Introduction

Travel expenses refer to the expenditure incurred on travelling for the purpose of carrying on any business or profession or employment. A taxpayer can claim the deduction for travel expenses while calculating their income from a particular source. Apart from business expenses, travelling expenses are eligible for deduction from income from other sources.

Understanding Travel expenses

Travel expenses consist of fuel costs, taxi fare, bus fare, metro rail fare, airfare, or charges for any other type of transportation. In a case where the means of transport is owned by self, such as a two-wheeler or four-wheeler, the travel expenses will include petrol or diesel costs per kilometre for the entire distance travelled.

In the case of public transport, travel expenses are the charges incurred for hiring a taxi or paying for metro rail services until the airport and then the cost of air tickets. The entire cost of travel from the point of residence to the destination is eligible for deduction. One may also claim the toll charges or charges for inter-state permits as part of travelling expenses.

An individual who is employed can claim reimbursement for travelling expenses incurred as part of the performance of duties or tasks of employment. Many explorers reimburse the costs either as part of the salary package or separately.

An employee should provide bills for the travelling costs or a self-declaration to claim the reimbursement. The reimbursed amount is exempt from tax for the employee.

There is no deduction for travelling expenses incurred on personal trips. In the case of combining personal trips with business trips, a deduction is available only for the portion attributable to the business. The expenses on travelling for personal reasons or for travelling costs of the spouse or other relatives are not eligible for deduction.

Travelling expenses can include the entire cost of a business trip, including travel costs, accommodation, meals, communication costs, and other incidental costs for business.

In certain cases, there may be an upper limit for claiming reimbursement for expenses. Certain companies provide a daily allowance for employees who go to a foreign country on short-term assignments. A deduction can be claimed to the extent of actual expenses incurred, and the balance gets taxed as salary.

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travelling expenses define

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  • Expenses and employee benefits

Expenses and benefits: travel and subsistence

As an employer paying your employees’ travel costs, you have certain tax, National Insurance and reporting obligations.

This includes costs for:

  • providing travel
  • reimbursing travel
  • accommodation (if your employee needs to stay away overnight)
  • meals and other ‘subsistence’ while travelling

Subsistence includes meals and any other necessary costs of travelling, for example parking charges, tolls, congestion charges or business phone calls.

There are different rules for reporting expenses relating to public transport .

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Here’s what taxpayers need to know about business related travel deductions

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IRS Tax Tip 2022-104, July 11, 2022

Business travel can be costly. Hotel bills, airfare or train tickets, cab fare, public transportation – it can all add up fast. The good news is business travelers may be able to off-set some of those costs by claiming business travel deductions when they file their taxes.

Here are some details about these valuable deductions that all business travelers should know.

Business travel deductions are available when employees must travel away from their tax home or main place of work for business reasons. The travel period must be substantially longer than an ordinary day's work and a need for sleep or rest to meet the demands the work while away.

Travel expenses must be ordinary and necessary. They can't be lavish, extravagant or for personal purposes.

Employers can deduct travel expenses paid or incurred during a temporary work assignment if the assignment length does not exceed one year.

Travel expenses for conventions are deductible if attendance benefits the business and there are special rules for conventions held outside North America .

Deductible travel expenses while away from home include the costs of:

  • Travel by airplane, train, bus or car between your home and your business destination.
  • Fares for taxis or other types of transportation between an airport or train station to a hotel, from a hotel to a work location.
  • Shipping of baggage and sample or display material between regular and temporary work locations.
  • Using a personally owned car for business which can include an increase in mileage rates .
  • Lodging and non-entertainment-related meals .
  • Dry cleaning and laundry.
  • Business calls and communication.
  • Tips paid for services related to any of these expenses.
  • Other similar ordinary and necessary expenses related to the business travel.

Self-employed or farmers with travel deductions

  • Those who are self-employed can deduct travel expenses on  Schedule C (Form 1040), Profit or Loss From Business (Sole Proprietorship) .
  • Farmers can use  Schedule F (Form 1040), Profit or Loss From Farming .

Travel deductions for the National Guard or military reserves

National Guard or military reserve servicemembers can claim a deduction for unreimbursed travel expenses paid during the performance of their duty .

Recordkeeping

Well-organized records make it easier to prepare a tax return. Keep records, such as receipts, canceled checks, and other documents that support a deduction.

More information:

  • Publication 463, Travel, Gift, and Car Expenses
  • IRS updates per diem guidance for business travelers and their employers

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Meaning of travelling expense in English

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Examples of travelling expense

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Key benefits of travel medical insurance

  • Travel medical insurance coverage
  • Who needs medical travel insurance?

Choosing the right travel medical insurance

How to use travel medical insurance, is travel medical insurance right for your next trip, travel medical insurance: essential coverage for health and safety abroad.

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  • Travel medical insurance covers unexpected emergency medical expenses while traveling.
  • Travelers off to foreign countries or remote areas should strongly consider travel medical insurance.
  • If you have to use your travel medical insurance, keep all documents related to your treatment.

Of all the delights associated with travel to far-flung locales, getting sick or injured while away from home is low on the savvy traveler's list. Beyond gut-wrenching anxiety, seeking medical treatment in a foreign country can be exceedingly inconvenient and expensive.

The peace of mind that comes with travel insurance for the many things that could ail you while abroad is priceless. As options for travel-related insurance abound, it's essential to research, read the fine print, and act according to the specifics of your itinerary, pocketbook, and other needs.

Travel insurance reimburses you for any unexpected medical expenses incurred while traveling. On domestic trips, travel medical insurance usually take a backseat to your health insurance. However, when traveling to a foreign country, where your primary health insurance can't cover you, travel medical insurance takes the wheel. This can be especially helpful in countries with high medical care costs, such as Scandinavian countries.

Emergency medical evacuation insurance

Another benefit that often comes with travel medical insurance, emergency medical evacuation insurance covers you for any costs to transport you to an adequately equipped medical center. Emergency medical evacuation insurance is often paired with repatriation insurance, which covers costs associated with returning your remains to your home country if the worst happens. 

These benefits are for worst-case scenarios, but they might be more necessary depending on the type of trips you take. Emergency medical evacuation insurance is helpful if you're planning on traveling to a remote location or if you're traveling on a cruise as sea to land evacuations can be costly. Some of the best travel insurance companies also offer non-medical evacuations as part of an adventure sports insurance package.

It's also worth mentioning that emergency medical evacuation insurance is required for international students studying in the US on a J Visa. 

Types of coverage offered by travel medical insurance

The exact terms of your coverage will vary depending on your insurer, but you can expect most travel medical insurance policies to offer the following coverages.

  • Hospital room and board
  • Inpatient/outpatient hospital services
  • Prescription Drugs
  • COVID-19 treatment
  • Emergency room services
  • Urgent care visits
  • Local ambulance
  • Acute onset of pre-existing conditions
  • Dental coverage (accident/sudden relief of pain)
  • Medical care due to terrorist attack
  • Emergency medical evacuation 
  • Repatriation of mortal remains
  • Accidental death and dismemberment

Travel medical insurance and pre-existing conditions

Many travel insurance providers will cover pre-existing conditions as long as certain conditions are met. For one, travelers need to purchase their travel insurance within a certain time frame from when they placed a deposit on their trip, usually two to three weeks. 

Additionally, travel insurance companies usually only cover stable medical conditions, which are conditions that don't need additional medical treatment, diagnosis, or medications.

Who needs travel medical insurance?

Even the best-laid travel plans can go awry. As such, it pays to consider your potential healthcare needs before taking off, even if you are generally healthy. Even if well-managed, preexisting conditions like diabetes or asthma can make a medical backup plan even more vital.

Having what you need to refill prescriptions or get other care if you get stuck somewhere other than home could be essential to your health and well-being. That's without counting all the accidents and illnesses that can hit us when away from home.

Individuals traveling for extended periods (more than six months) or engaging in high-risk activities (think scuba diving or parasailing) should also consider a solid medical travel plan. Both scenarios increase the likelihood that medical attention, whether routine or emergency, could be needed.

In the case of travel via the friendly seas, it's also worth considering cruise trip travel insurance . Routine care will be available onboard. But anything beyond that will require transportation to the nearest land mass (and could quickly become extremely expensive, especially if you're in another country).

Like other types of insurance, medical travel insurance rates are calculated based on various factors. Failing to disclose a preexisting health condition could result in a lapse of coverage right when you need it, as insurers can cancel your policy if you withhold material information. So honesty is always the best policy.

Even the best-laid travel plans can go awry. As such, it pays to consider your potential healthcare needs before taking off, even if you are generally healthy. Making the right choice when shopping for travel medical insurance can mean the difference between a minor hiccup in your travels and a financial nightmare. 

When a travel insurance company comes up with a quote for your policy, they take a few factors into consideration, such as your age, your destination, and the duration of your trip. You should do the same when assessing a travel insurance company. 

For example, older travelers who are more susceptible to injury may benefit from travel medical insurance (though your premiums will be higher). If you're traveling for extended periods throughout one calendar year, you should look into an annual travel medical insurance plan . If you're engaging in high-risk activities (think scuba diving or parasailing), you should seek a plan that includes coverage for injuries sustained in adventure sports.

In the case of travel via the friendly seas, it's also worth considering cruise trip medical travel insurance. Routine care will be available onboard. But anything beyond that will require transportation to the nearest land mass (and could quickly become extremely expensive, especially if you're in another country).

Travel medical insurance isn't just for peace of mind. If you travel often enough, there's a good chance you'll eventually experience an incident where medical treatment is necessary.

Before you submit your claim, you should take some time to understand your policy. Your travel medical insurance is either primary (you can submit claims directly to your travel medical insurance provider) or secondary (you must first submit claims to your primary insurance provider). In the case of secondary travel medical insurance, a refusal notice from your primary insurance provider, even if it does not cover medical claims outside the US, is often required as evidence of protocol.

On that note, you should be sure to document every step of your medical treatment. You should keep any receipts for filled prescriptions, hospital bills, and anything else documenting your medical emergency.

As many people have found out the hard way, reading the fine print is vital. Most travel insurance policies will reimburse your prepaid, nonrefundable expenses if you fall ill with a severe condition, including illnesses like COVID-19. 

Still on the fence about whether or not  travel insurance is worth it ? It's worth noting that many travel insurance plans also include medical protections, so you can also protect against trip cancellations and other unexpected developments while obtaining travel medical insurance.

While short, domestic trips may not warrant travel medical insurance, it may be a good idea to insure longer, international trips. You should also consider travel medical insurance for trips to remote areas, where a medical evacuation may be expensive, and more physically tasking trips.

While shopping for travel medical insurance may not be fun, a little advance leg work can let you relax on your trip and give you peace of mind. After all, that is the point of a vacation. 

Medical travel insurance frequently asked questions

Trip insurance covers any unexpected financial losses while traveling, such as the cost of replacing lost luggage, trip interruptions, and unexpected medical expenses. Travel medical insurance just covers those medical expenses without the trip interruption or cancellation insurance.

Travel insurance companies usually offer adventure sports as add-on coverage or a separate plan entirely. You'll likely pay more for a policy with adventure sports coverage. 

Many travel medical insurance policies now include coverage for COVID-19 related medical expenses and treat it like any other illness. However, you should double-check your policy to ensure that is the case.

travelling expenses define

  • Main content

Which purchases count as travel with Chase Sapphire Preferred and Chase Sapphire Reserve?

Benét J. Wilson

Editor's Note

Thanks to its plethora of premium travel perks, the Chase Sapphire Reserve® is well-known in the travel credit card space. The Chase Sapphire Preferred® Card is the Sapphire Reserve's mid-tier sibling that features a $95 annual fee — which is also the more affordable card considering the Reserve's annual fee is $550 — and remains a top pick, winning Best Travel Rewards Credit Card for the sixth straight year at the 2023 TPG Awards .

No matter which Sapphire card you have, Chase clearly defines what counts as travel. Both cards generously award for travel booked through Chase Travel℠ and all other travel purchases.

We'll go over the purchases that count (and don't count) toward earning bonus points in this guide.

How many points do the Chase Sapphire Reserve and Preferred cards earn on travel?

The Chase Sapphire Reserve awards 10 points per dollar on hotels and car rentals booked through Chase Travel and 5 points per dollar on flights booked through Chase Travel.

But suppose you're looking to book directly with the airline, hotel or another company or get awarded for other travel purchases like taxi rides and parking fees. In that case, you'll still earn 3 points per dollar on these purchases.

travelling expenses define

The Sapphire Preferred earns 5 points per dollar on all travel purchases booked through Chase Travel and 2 points per dollar on other travel purchases.

You'll also earn a boosted rate of 10 and 5 points per dollar spent on Lyft rides on the Reserve and Preferred, respectively (through March 2025).

'Travel,' according to Chase

The Chase Travel portal allows you to book various types of travel. For "all other travel purchases," here's how Chase defines it:

Merchants in the travel category include airlines, hotels, motels, timeshares, car rental agencies, cruise lines, travel agencies, discount travel sites, campgrounds and operators of passenger trains, buses, taxis, limousines, ferries, toll bridges and highways, and parking lots and garages.

Compared to bonus categories from other credit cards, Chase's travel category is extremely generous.

While cards such as the American Express® Gold Card and The Platinum Card® from American Express offer bonus points for airfare purchases made directly with the airline (with a spending cap of $500,000 on the Amex Platinum per calendar year, then 1 point per dollar), the Sapphire Preferred and Sapphire Reserve cards let you earn a bonus on virtually every trip-related charge.

travelling expenses define

The travel category encompasses a wide variety of purchases, from hotels and airfare (which doesn't have to be booked directly with the airline) to cruises, tolls and even parking fees. Uber and Airbnb purchases count as travel as well.

The following purchases do not apply toward the 2 or 3-points-per-dollar bonus categories on these cards, but most of them shouldn't be a huge surprise or disappointment:

Merchants in this category include airlines, hotels, motels, timeshares, car rental agencies, cruise lines, travel agencies, discount travel sites, campgrounds and operators of passenger trains, buses, taxis, limousines, ferries, toll bridges and highways, and parking lots and garages. Some merchants that provide transportation and travel-related services are not included in this category; for example, real estate agents, educational merchants arranging travel, in-flight goods and services, on-board cruise line goods and services, sightseeing activities, excursions, tourist attractions, RV and boat rentals, merchants within hotels and airports, public campgrounds and merchants that rent vehicles for the purpose of hauling. Purchases from gift card merchants or merchants that sell points or miles will not qualify in the travel category.

A few notable travel-related charges that have not been posted as travel for the purposes of bonus points with Chase for TPG staffers in the recent past include an RV rental as well as some vacation rentals via Vrbo and similar services. Whether a vacation home rental automatically codes as travel depends on whether an individual or a conglomerate operates it. In the latter case, that charge may code as "professional services" instead of travel.

If you're ever unsure whether a given purchase counts as travel, it could be worth making a small charge and checking whether it earns any bonus points on your online Chase account.

Additionally, suppose you feel like a travel purchase should have earned bonus points but didn't. In that case, you can always try calling or secure messaging Chase and requesting consideration for that charge to be awarded points as a travel charge. Even if you don't get the outcome you're looking for, you'll at least get some clarity on how certain charges are coded and can plan future spending accordingly.

What does Chase typically count as travel purchases?

  • Campgrounds
  • Car rental agencies (excludes RV and boat rentals)
  • Cruise lines
  • Discount travel sites
  • Parking lots and garages
  • Passenger trains
  • Toll bridges and highways
  • Travel agencies
  • Vacation rentals (including some VRBO rentals operated by an individual )

What does Chase typically not count as travel purchases?

  • Educational merchants arranging travel
  • Gift card merchants
  • Inflight goods and services
  • Merchants that rent vehicles for the purpose of hauling
  • Merchants within hotels and airports
  • Onboard cruise line goods and services
  • Purchasing points or miles
  • Public campgrounds
  • Real estate agents
  • RV and boat rentals
  • Sightseeing activities
  • Tourist attractions
  • Vacation rentals ( some VRBO rentals operated by a conglomerate rather than an individual )

Bottom line

Cardholders of the Chase Sapphire Reserve and Chase Sapphire Preferred have plenty of opportunities to earn 3 or 2 points per dollar spent, respectively, on "other travel purchases." Based on TPG's valuations , that means you could be getting a return of up to 6.15% on these purchases, and you can put your points to use with Chase's airline and hotel partners .

On top of that, these Chase cards have some of the most generous travel and purchase protections on the market, making either card a valuable addition to your wallet.

Apply here: Chase Sapphire Reserve with a 60,000-point sign-up bonus after you spend $4,000 in the first three months of account opening. Apply here: Chase Sapphire Preferred with a 60,000-point sign-up bonus after you spend $4,000 in the first three months of account opening.

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  12. What Are Business Travel Expenses? (Plus Benefits and Tips)

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  13. How to Deduct Business Travel Expenses: Do's, Don'ts, Examples

    To be able to claim all the possible travel deductions, your trip should require you to sleep somewhere that isn't your home. 2. You should be working regular hours. In general, that means eight hours a day of work-related activity. It's fine to take personal time in the evenings, and you can still take weekends off.

  14. 7 Rules You Should Know About Deducting Business Travel Expenses

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  18. Travelling Expenses

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