uq dual purpose travel guide · uq dual purpose travel guide. as at 12 december 2016 . overview....

UQ Dual Purpose Travel Guideas at 12 December 2016

OverviewDual purpose travel & Fringe Benefit Tax (FBT)• Employees of UQ travel both domestically and

internationally for work.

• Dual purpose travel (“DPT”) occurs when a trip includes both a business component and a private component.

• Where UQ pays for the private component of travel costs an FBT liability will arise.

– Instead of an employee receiving remuneration (and being taxed accordingly), they are receiving benefits that are not included in their assessable income. FBT is the means by which the ATO ensures that these benefits are taxed (in the hands of UQ as the employer).

• UQ Travel Policy PPL 1.90.01 specifies that UQ will not pay for travel that incur an FBT liability. UQ only pays for the business components of a trip and travellers must pay for the private components.

• However some costs of travel cannot be easily separated between business and private components (e.g. a flight to a destination where an employee will attend to work and also have a holiday).

Dual purpose travel and this Guide• The purpose of this Guide is to assist travellers in

determining the components of travel costs that should be paid by UQ vs. the traveller, to eliminate any FBT liability.

• This Guide is prepared based on legislation and private rulings obtained from the ATO.

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UQ’s transparency in spending taxpayer fundsUQ is a statutory body incorporated by the Queensland Government and must ensure that taxpayer funds are spent in the most efficient, effective and economic manner.

Accordingly, funds cannot be spent on private expenditure, nor perceived to be spent on expenses of a private nature.

Whilst we may eliminate UQ’s exposure to FBT in dual purpose travel scenarios, travellers must also consider whether the inclusion of private travel (even with no FBT liability) is still resulting in an appropriate use of taxpayer funds.

Cost of travel is irrelevant for FBT rulesTravellers will often choose to go via a location because “it’s the cheaper option”. This can be an acceptable business decision, however the ATO do not consider cost when applying FBT to dual purpose travel.

You can choose to go via a location if it’s cheaper (i.e. transit through) but as soon as you remain in a location for private purposes you can be caught by the FBT rules.

UQ Travel Policy & Procedures PPL 1.90.01It is assumed that the University travel discussed on the following pages has been approved in conjunction with the UQ Travel Policy and Procedures and the necessary substantiation requirements are maintained.

Travellers’ responsibilities & documentation 3

UQ traveller’s responsibilities• If a traveller is unclear on the FBT implications of

travel they are proposing, they should first liaise with their relevant Finance Officer and then FBS Tax, prior to booking.

• All travellers who intend to include a private component during UQ travel are required to inform their travel approver prior to booking.

• When seeking approval to travel and there is a private component to the trip, it is the responsibility of the traveller to attach either:

– the determination of the Dual Purpose Travel Calculator – Domestic (for travel that only occurs in Australia); or

– the determination of the Dual Purpose Travel Calculator – International (for travel to international and/or Australian locations).

• Travellers should make all efforts to eliminate any FBT liability prior to the booking of travel.

– To eliminate an FBT liability, travellers must try to arrange payment of the private components of the travel directly with the travel providers e.g. Campus Travel.

– If this is not possible, reimbursement will be sought from the traveller for the costs of any private component incurred by UQ that relates to dual purpose travel.

Dual Purpose Travel calculators• FBS Tax have developed DPT calculators that reflect

the rules covered in this Guide.

• These calculators must be used at the planning stage of dual purpose travel, as they will identify the costs of travelling to and from destinations that will eliminate any FBT liability.

• The DPT Calculator – Domestic will also ensure the traveller (and therefore UQ) is compliant with the ATO’s travel diary requirements for travel that is 6 or more nights.

• The calculators can be accessed via either the Online Forms section of the FBS website or via the links included on the Travel website.

Travel costsCosts incurred during travel can normally be classified into the following categories:

• Accommodation

• Meals & incidentals

• Local transport (e.g. rail pass, taxi)

• Airfares

Distinct travel costsAccommodation, meals & incidentals and local transport are generally considered distinct costs as the private andbusiness components can be easily separated.

Airfares can be considered both distinct and indistinct depending on the circumstance.

Payment of distinct travel costs Business only travelWhere a trip is 100% for business purposes, UQ will pay for all travel costs and there will be no FBT liability.

Dual purpose travelWhere a trip has both business and private purposes (i.e. dual purpose travel), distinct costs must be classified into their private and business components.

UQ will pay for all distinct costs related to the business purpose. The traveller must pay for all distinct costs related to the private purpose.

Example of distinct costs:

Carol travels to Washington DC for 10 days. She spends 6 days at a business conference and then 4 days sightseeing before returning to Brisbane.

UQ would pay for the 6 nights accommodation for the conference as these are distinctly business costs.

The additional 3 nights accommodation after the conference are clearly private in nature. The same would apply to any meals & incidentals, or local transport on the sightseeing days. As they are distinctly private costs, they must be paid for by Carol to eliminate FBT.

Indistinct travel costs In dual purpose travel, airfares are often considered an indistinct cost as it can be difficult to separate the private and business components of an airfare.

Example of indistinct costs: airfare

Using the same example above, Carol has travelled to a location for both business and private purposes. On a first glance, it is not easy to see how the cost of the return airfare from Brisbane to Washington DC should be apportioned between the business and private components.

As such, it is difficult to determine if there will be a FBT liability or how much of the return airfare needs to be paid by Carol to eliminate that liability.

Continued over…

Travel costs - distinct vs. indistinct costs 4

The ‘Merely Incidental Rule’ 5

Distinct or indistinctAirfares (and other forms of transport between locations) can be considered both distinct or indistinct depending on the circumstance.

Example: airfares as distinct costs

Justin travels from Brisbane to Sydney solely for a work conference. At the end of the conference, he travels to Canberra solely to visit friends. He then goes back to Sydney and then back to Brisbane.

In this scenario, there are 4 flights in total – a return trip from Brisbane to Sydney and a return trip from Sydney to Canberra.

If these flights are separately identified when making the booking, they are distinct:1. The return flight from Brisbane to Sydney is solely for

business purposes and would be paid by UQ as a distinctly business cost.

2. The return flight from Sydney to Canberra is solely for private purposes and would be paid by Justin as a distinctly private cost.

Example: airfares as indistinct costs

Using the same example as above, the airfares would be considered indistinct costs if:

1. Justin booked all four flights as an all-inclusive airfare.

2. Justin had private days in Sydney or business days in Canberra.

3. Justin decided to fly Brisbane > Sydney > Canberra > Brisbane.

Payment of indistinct travel costsWhere an airfare relates to a trip that has both business and private purposes, the traveller needs to apply the merely incidental rule (“MIR”).This rule will determine what components of the indistinct costs need to be paid by the traveller to eliminate any FBT liability.

The merely incidental rule The merely incidental rule applies to each location of the trip and not the trip as a whole.

1. A location passes the merely incidental rule if:

Private days < Business days = merely incidentalIf the number of private days in a location is less than the number of business days, the private purpose is considered by the ATO as ‘merely incidental’ and no FBT liability will arise on indistinct costs (e.g. airfares) fully paid by UQ.

Example: passing the merely incidental rule

Carol travels to Washington DC for 10 days. She spends 6 days at a business conference and then 4 days sightseeing before returning to Brisbane.

The return airfare (Brisbane > DC > Brisbane) is an indistinct cost as the location is being visited for both business and private purposes. However, as the private component of Carol’s trip is considered ‘merely incidental’ (there are more business days than private days in Washington DC) Carol does not have to pay any portion of the return airfare.

Defining travel days when applying the merely incidental ruleIt is the traveller’s responsibility to determine the split between business days and private days on their UQ travel.

The definitions of a business vs. private day is detailed below. The DPT calculators apply these definitions in assessing for the traveller whether they pass or fail the merely incidental rule.

Definition of business days A day on which official UQ business is conducted*; A day on which an employee travels to / from the employee’s

usual place of business (usually Brisbane) for official UQ business purposes;

A day on which an employee travels to a location for official UQ business purposes;

A weekend during the trip, where the preceding Friday and the following Monday are official UQ business days;

A public holiday during the trip, where the preceding day and the following day are official UQ business days; and

A "recovery day" which is the day following the day where an employee has completed a flight of 7 or more hours, provided the day after the recovery day is used for official UQ business

*To be classified as an official UQ business day, the dominantpurpose of that day needs to be working on UQ business. For example: attendance at official meetings / conferences / seminars / preparation of presentations / working on UQ budget / operation report / general UQ business. Checking emails for an hour or two would not generallyconstitute a business day.

Merely incidental rule – definition of days 6

Merely incidental rule (cont’d)2. A location fails the merely incidental rule if:

Private days ≥ Business days ≠ merely incidentalIf the number of private days in a location is equal to or more than the number of business days, the private component is not considered by the ATO to be ‘merely incidental’. A portion will be payable by the traveller to eliminate the FBT liability on the indistinct costs (e.g. airfares).

Example: failing the merely incidental rule

Modifying the previous example, Carol decides to spend 20 days in Washington DC. The first 6 days are for the conference and the remaining 14 days are for exploring the city (she loves museums).

In this situation, the private component is no longer ‘merely incidental’ and Carol will have to pay a portion of the return airfares to the supplier e.g. Campus Travel to eliminate FBT, in addition to the distinct costs for the private days.

Where the merely incidental rule is failed, the portion of indistinct costs payable by the traveller is determined by using the guide and table on the following pages.using the guide and table on the following pages.

Private

Business

Weigh it up: Business days > Private days = ‘merely incidental’

Merely incidental rule – definition of days 7

Impact of applying the merely incidental rule on a location basisA day in two locations As the merely incidental rule is applied on a per location basis, there will be instances when a day is counted twice. This day may be classified as both business and private depending on the purpose in the two locations visited.

Example: a day counted twice

Using the previous example of Justin travelling to Sydney solely for work and Canberra solely for private purposes; assume Justin’s conference finished in Sydney on the Friday afternoon and he flew to Canberra that evening.

When applying the merely incidental rule to Sydney as a location, Justin would count the Friday as a business day (as he spent it in Sydney at a work conference).

When applying the merely incidental rule to Canberra, he would count the Friday as a private day, as he is travelling to Canberra solely for private purposes.

Lost daysThe merely incidental rule applies from the date arriving in a location up to and including the date of departure. As such, days ‘lost’ due to crossing the international date line will not be counted when applying the rule.

For example: A flight from Los Angeles to Sydney may depart on Monday but does not arrive in Sydney until Wednesday. The Tuesday “lost” in between is not counted for either Los Angeles or Sydneywhen applying the merelyincidental rule.

Definition of private daysAny other days that do not meet the business days definition are considered private days.

Important note on defining ‘days’ in applying MIRWhether an employee is on approved leave does not have an impact on the classification of a business or private day. For example, an employee may work 15 hours on one day and their supervisor allows them to take the next day off as a time in lieu. This is considered one business day and one private day.

Gap daysThere may be occasions where it is impractical for an employee to travel home in between two different business purposes.

For example: a conference in New York may finish on a Wednesday and another conference may start on the following Monday in Washington DC. In such instances, it is up to the travel approver to determine if it is not practical for the traveller to return home.

If the traveller does not work on the Thursday and Friday, these would still be classified as private days. However, the trip could be structured so that the employee agrees to do normal UQ work on these days from their hotel room or office. This would then meet the business days definition and they can be classed as business days.

Transit / unavoidable stopover locationsIf airfares booked include a transit / unavoidable stopover, this is not considered as a “visited location”. The only exception is where an employee is returning to a previously visited business location.

Booking & funding UQ Travel 8

If the costs are not separately identified on the invoicesIn the situation where an all-inclusive airfare has been purchased that includes locations with a dual purpose, FBT will apply to the whole cost of the airfare because the cost of the individual flights cannot be separately identified.

Providing a ‘quote’ for the estimated cost of a solely private leg; or a location that fails the merely incidental rule, within an all-inclusive airfare and reimbursing UQ for that estimated amount will not be sufficient to meet the ATO requirements.

The traveller should request the travel supplier provide abreakdown of each leg of the travel so that each cost can be separately identified to allow for split payment.

Costs that are separately identified on the invoices It is essential that the costs travelling to and from a location that fails the merely incidental are separately identified on the travel provider’s invoice.

This ensures that an FBT liability will not arise and that the traveller will not be incurring costs that could have been funded by UQ.

For example, if making a booking through Campus Travel, the total cost should be split into two invoices:

(1) Invoice issued to UQ for the distinctly business costs + business component of the indistinct costs; and

(2) Invoice issued to the traveller for the distinctly private costs + the private component of the indistinct costs.

The portion of the costs which need to be met by the traveller should then be paid directly by the traveller to the provider.

If a split invoice is not possible, the entire cost can be initially paid by UQ however the traveller must reimburse UQ for the private component as soon as possible.

Failure to reimburse will be in breach of UQ policy.

Table 1: Costs fully funded by UQ 9

Flight/Bus/Train departing from Flight/Bus/Train arriving in Cost for traveller Cost for UQ

The starting point of the UQ trip 1(e.g. Home / Brisbane) a location that passes the merely incidental rule 0% 100%

A location that passes the merely incidental rule

(i.e. business location with less than 50% private)

a location that passes the merely incidental rule 0% 100%

end point of trip (e.g. Home / Brisbane) 2 0% 100%

1 Usually the starting point of the UQ trip would be the traveller’s home (e.g. Brisbane). However there are situations where thetraveller may start their UQ trip from a location that isn’t their usual home. For example: an employee’s home may be in Brisbane but they are holidaying in Los Angeles. If they are then travelling to New York for UQ work, they may start that UQ trip from LA instead of returning to Brisbane. 2 A return flight/bus/train from the starting point of the trip (usually Brisbane) to a location that passes the merely incidental rule can be fully funded by UQ.

Note: A location where an unavoidable stopover/layover occurs is not considered a ‘visited location’.

Example: not a visited location

A flight from Brisbane to London has an unavoidable 3-hour stopover in Dubai. This is considered a flight between Brisbane and London when applying the rules above.

Travel costs to/from locations that both pass the merely incidental ruleWhen a location passes the merely incidental rule (i.e. the number of private days in a location is less than the number of business days) the following costs are fully covered by UQ provided they are separately identified on the invoices:

Private

Business

Table 2: Costs not fully funded by UQ 10

Flight/Bus/Train departing from Flight/Bus/Train arriving in Cost for traveller1 Cost for UQ1

The starting point of the UQ trip (e.g. Home)

a location en route solely for private purposes 50% 50%

a location en route that fails the merely incidental rule 50% 50%

a location not en route for private purposes2 100% 0%

A location solely for private purposes (i.e. no business purpose

in this location)5

any non-end location (regardless of business vs. private)3 100% 0%

end location of trip provided departing location is en route4

(e.g. arriving Home) 50% 50%

A location with both business and private purposes that fails the

merely incidental rule

a solely private location 100% 0%

a location that fails the merely incidental rule 50% 50%

a location that passes the merely incidental rule 50% 50%

a location that enables you to go home but with a stay for private purposes 100% 0%

end location of trip (e.g. Home)4 50% 50%

A location with both business and private purposes that passes the

merely incidental rule

a location solely for private purposes 100% 0%

a location en route that fails the merely incidental rule 50% 50%

1 This split of costs assumes that the traveller has itemised costs of flight/bus/train as required by UQ Policy for indistinct costs.2 This is payable by the traveller on the basis that the cost would not have been incurred by UQ if only travelling for business. e.g. travelling from Brisbane to Los Angeles via Perth >> Perth would not be reasonably considered “en route”.3 The ATO confirmed this as wholly payable by the traveller as the departing location is solely private (regardless of next destination).4 Reminder: If the flight booked to the end point / home includes an unavoidable stopover in a location, and that location is not covered by the previous slide (as a predominantly business location); it is not considered a “visited location” when applying the rules in this table. 5 You do not apply the merely incidental rule to a solely private location as it does not have any business days i.e. it is distinctly private.

Travel costs to/from locations where either fail the merely incidental ruleWhen a location fails the merely incidental rule (i.e. the number of private days in a location is equal to or more than the number of business days) the indistinct costs are not fully covered by UQ. The traveller must pay a component of the indistinct costs to eliminate the FBT liability as determined using the following table. The cost must be separately identified on the invoices to enable the rules on this table to be applied.

Process for planning dual purpose travel 11

ExamplesThe remainder of this guide contains examples to help UQ travellers understand the FBT implication of travel. They cover the majority of travel scenarios at UQ.

We recommend you apply the steps below when planning your UQ travel. Remember, FBT applies to employees and their associates (e.g. spouse, relatives, nominees); not to non-employees of UQ (e.g. students). If a traveller is unclear on the FBT implications of travel they are proposing, they should first liaise with their relevant Finance Officer and then FBS Tax, prior to booking.

Steps to assessing travel itineraries in the planning stage of travel:1. Identify the locations being visited 2. Identify the number of days in each location:

a) Split these into private days vs. business daysb) Are the private days merely incidental in each location? If there are private-only or predominantly private location/s:

There are FBT implications with these locations >> review carefully the proposed travel plans and budgeted costs as all-inclusive, non-severable packages will likely incur FBT and, if not reimbursed for the private component, be in breach of UQ Policy.

2. Separate the costs that UQ will be paying for (or reimbursing) in each location to the following buckets:

3. Can we separate these costs between the distinct business and distinct private portions?a) Determine the amounts required to be paid for by the traveller vs. UQ that complies with UQ Policy and eliminates FBT.

CAUTION

Airfares/Trains/Buses to/from the location Accommodation Meals / Incidentals Local transport (e.g.

taxis)

EXAMPLES OF DUAL PURPOSE TRAVEL

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Examples – quick reference guide 13

Example Application1.1 Domestic travel – one location + merely incidental rule passed

1.2 Domestic travel – multiple locations + solely private location

1.3 Domestic travel – multiple locations + solely private location + not en route

2.1 International travel – one location + merely incidental rule passed

2.2 International travel – one location + recovery day + merely incidental rule passed

2.3 International travel – one location + unavoidable stopover + merely incidental rule passed

2.4 International travel – one location + holiday in stopover + merely incidental rule passed

2.5 International travel – one location + holiday in stopover + merely incidental rule failed

3.1 International travel – multiple locations + private time in a business location

3.2 International travel – multiple locations + private time in a business location + short gap between

3.3 International travel – multiple locations + private time in a business location + long gap between

3.4 International travel – multiple locations + private time in a business location + long gap between + gap spent in private locations

Examples of dual purpose travel (Domestic)Example 1.1: Domestic dual purpose travel (same city)Steven, an employee of UQ, is travelling to Sydney for work Wednesday to Friday. He wants to stay in Sydney for the weekend, flying back late Sunday night before returning to work in Brisbane on Monday. His itinerary is as follows.

Accommodation, meals & incidentals (distinct)

Accommodation, meals & incidentals and local transport costs incurred by Steven between Wednesday and Friday will bepaid by UQ. If the work finishes late on Friday and it is unreasonable to return to home that evening, UQ would also pay for the accommodation on the Friday night.

Any accommodation, meals & incidentals and local transport incurred by Steven on Saturday and Sunday must be paid by the employee (as these are distinctly private costs).

The only exception is the cost of travelling to/from the airport on the Sunday. This will be paid for by UQ.

14travel (Domestic) 14

Date Day City Activities B/P/L30/11/2016 Wed BNE – SYD Work B1/12/2016 Thu Sydney Work B2/12/2016 Fri Sydney Work B3/12/2016 Sat Sydney Private time P4/12/2016 Sun SYD - BNE Private time B

SydneyBusiness days: 4 80%

Private days: 1 20%5

Airfares (indistinct)

This trip is a case of dual purpose travel. However, as the number of private days are less than 50%, the merely incidental rule is passed and the airfares can be fully funded by UQ.

As per the travel itinerary table, the Sunday is classed as a business day as it is “a day on which an employee travels to/from their usual point of business.”

Please note this is a business day only in applying the merely incidental rule. It does not mean that all costs incurred on the Sunday will be paid by UQ.

Example 1.2: Domestic dual purpose travel (different cities)Assume the same facts and dates as in Example 1.1.

The only exception is that Steven intends to visit friends in Canberra over the weekend as opposed to staying in Sydney. His travel itinerary is as follows:


Accommodation, meals & incidentals and transport costs incurred by Steven between Wednesday and Friday in Sydney will be paid by UQ.

Any accommodation, meals & incidentals and transport incurred by Steven between Friday and Sunday in Canberra must be paid by the employee (as these are distinctly private costs).

Examples of dual purpose travel (Domestic)Airfares (distinct & indistinct)

If separately identified on the invoices, the portion of the airfare costs payable by Steven would be as follows:

An all-inclusive airfare is not permitted as it would not be possible to split out of the cost of the private portion.

Note that we have considered Canberra “en route” in this situation. It is in the same part of the country and the distance between Sydney and Canberra is not significant. On the flip side, if the employee travelled from Sydney to Perth and then Perth to Brisbane, this would not be considered en route.

Continued over…

15travel (Domestic)

the portion of the airfare be as follows:

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Date Day City Activities B/P/L30/11/2016 Wed BNE > SYD Work B1/12/2016 Thu Sydney Work B2/12/2016 Fri SYD > CBA Work. Fly to Canberra B/P3/12/2016 Sat Canberra Private time P

4/12/2016 Sun CBA > BNEPrivate time.

Fly to Brisbane P

SydneyBusiness days 3 100%Private days 0 0%

CanberraBusiness days 0 0%Private days 3 100%

Flight ScenarioCost to Steven

BNE > SYDFlight from the start point of the UQ trip arriving in a location that passes the merely incidental

rule0%

SYD > CBRFlight departing a location that passes the

merely incidental rule to a location solely for private purposes

100%

CBR > BNEFlight departing a location solely for private

purposes to the end location of the trip (with the departing location en route)

50%

Examples of dual purpose travel (Domestic)Example 1.2 (cont’d):Alternative

Rather than fly directly home from Canberra on the Sunday, the traveller could choose to return to Sydney first. In this situation, the airfare costs payable by the traveller would be distinct and classified as follows:

16travel (Domestic) 16


BNE > SYD Flight from the start point of the UQ trip arriving in a location that passes the merely incidental rule 0%

SYD > CBRFlight departing a location that passes the merely

incidental rule to a location solely for private purposes

100%

CBR > SYD Flight departing a location solely for private purposes arriving in a non-end location 100%

SYD > BNE Departing a location that passes the merely incidental rule to the end point of trip 0%

Example 1.3: Domestic dual purpose travel (different cities not en route)Assume the same facts and dates as in Example 1.1.

The only exception is that prior to the conference, Steven takes annual leave and goes on a week-long holiday in Cairns. He wishes to fly to Sydney directly from Cairns on the Wednesday.

The same outcome will apply as in Example 1.1.

However, the cost of the flight from Cairns to Sydney must be fully paid for by Steven as they are travelling from a location that is not en route.

If separately identified on the invoices, the portion of the airfare costs payable by the traveller would be as follows:

To reduce costs, the traveller could consider returning to Brisbane from Cairns before travelling to Sydney. The flight from Brisbane to Sydney would then be distinctly business and fully funded by UQ as per Example 1.1.


BNE > CNS BOOKED PERSONALLY 100%

CNS > SYD Flight departing a location solely for private purposes to any non-end location 100%

SYD > BNE Flight departing a location that passes the merely incidental rule to end point of trip 0%

Examples of dual purpose travel (International)Airfares (indistinct)

This trip is a case of dual purpose travel. However, as the number of private days are less than 50%, it passes the merely incidental rule and the airfares can be fully funded by UQ.

As per the travel itinerary table, the Tuesday (Dec 6) is classed as a business day as it is “a day on which an employee travels to/from their usual point of business.”

Please note this is a business day only in applying the merely incidental rule. It does not mean that all expenses incurred on the Tuesday (Dec 6) will be paid by UQ.

Example 2.2: Dual purpose travel to one location (with recovery day)Assume the same facts and dates as in Example 2.1.

The only exception is that the conference is only 4 days and commences on Tuesday (Nov 29) as opposed to the day before.

As Emma travelled on a 7+ hour flight to London on Sunday (Nov 27) and Tuesday (Nov 29) will be used for official UQ business, the Monday (Nov 28) will count as a recovery day.

As the private days are still less than half of the trip (30%), the merely incidental rule is passed and therefore the outcome remains the same as presented in Example 2.1.

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Example 2.1: Dual purpose travel to one location onlyEmma, an employee of UQ, travels to London for work andher itinerary is as follows:

Date Day City Activities B/P/L27/11/2016 Sun BNE > LDN Fly to London B28/11/2016 Mon London Conference B29/11/2016 Tue London Conference B30/11/2016 Wed London Conference B1/12/2016 Thu London Conference B2/12/2016 Fri London Conference B3/12/2016 Sat London Private time P4/12/2016 Sun London Private time P5/12/2016 Mon London Private time P6/12/2016 Tue LDN > BNE Fly to Brisbane B

LondonBusiness days: 7 70%



Accommodation, meals & incidentals and local transport costs incurred by Emma between Sunday (Nov 27) and Saturday (Dec 3) will be paid by UQ.

Any accommodation, meals & incidentals and local transport incurred by Emma between Saturday (Dec 3) and Tuesday (Dec 6) must be paid by Emma (as these are distinctly private costs).

The only exception is the cost of travelling to/from the airport on the Tuesday (Dec 6). This will be paid for by UQ.

Examples of dual purpose travel (International)Example 2.4: Dual purpose travel to one location only (with holiday in a stop over location)Emma is travelling to London for work and the proposed flights require a stopover in Singapore. Emma decides to spend 2 nights in Singapore as opposed to continuing straight through to London. Her itinerary is as follows:

There is no business requirement for Emma to stay in Singapore longer than the layover, so the two days spent in Singapore would be classified as private days.

Continued over…

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Example 2.3: Dual purpose travel to one location only (with unavoidable stop over)Assume the same facts and dates as in Example 2.1.

The only exception is that the proposed flights require a stopover in Singapore and due to scheduling, the flight from Singapore to London occurs the following morning. The travel itinerary would be as follows:

As the stopover is unavoidable, Emma will not be required to pay for the expenses incurred in spending the night in Singapore and the outcome remains the same as in Example 2.1.

Date Day City Activities B/P/L27/11/2016 Sun BNE > LDN Fly to Singapore B28/11/2016 Mon BNE > LDN Fly to London L29/11/2016 Tue London Conference B30/11/2016 Wed London Conference B1/12/2016 Thu London Conference B2/12/2016 Fri London Conference B3/12/2016 Sat London Private time P4/12/2016 Sun London Private time P5/12/2016 Mon London Private time P6/12/2016 Tue LDN > BNE Fly to Brisbane B



Lost days: 1 N/A

Date Day City Activities B/P/L

27/11/2016 Sun BNE > SIN Fly to Singapore - remain overnight P

28/11/2016 Mon Singapore Private time P

29/11/2016 Tue SIN > LDN Fly to London P/B

30/11/2016 Wed London Conference B1/12/2016 Thu London Conference B2/12/2016 Fri London Conference B3/12/2016 Sat LDN > BNE Fly to Brisbane B4/12/2016 Sun LDN > BNE (Cross date line) L

SingaporeBusiness days: 0 0%



Private days: 0 0%6

Lost days: 1 N/A

Examples of dual purpose travel (International)Example 2.4 (cont’d):Accommodation, meals & incidentals (distinct)

Accommodation, meals & incidentals and local transport costs incurred by Emma in London will be paid by UQ.

Any accommodation, meals & incidentals and transport incurred by Emma in Singapore must be paid by the traveller (as these are distinctly private costs).

Airfares (distinct & indistinct)

If separately identified on the invoices, the portion of the airfare costs payable by Emma would be as follows:

An all-inclusive airfare is not permitted as it would not be possible to split out of the cost of the private component.

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Alternative

To avoid having to pay 100% of the flight from Singapore to London, Emma could book and pay directly for her Brisbane to Singapore flight.

The starting point of the UQ trip in this scenario would be Singapore, so the airfare cost to the traveller may be reduced as they would only pay for the following:

The decision for Emma between starting the UQ trip in Brisbane or Singapore will differ depending on the price of each flight.

Flight Scenario Cost to Emma

BNE > SIN Flight from starting point of UQ trip to alocation en route solely for private purposes 50%

SIN > LDN Flight departing from a location solely for private purposes to any non-end location 100%

LDN > BNE Flight departing from a location that passes the merely incidental rule to end point of trip 0%

Note: Singapore is not considered a “visited location” on the return trip home as Emma is not remaining in Singapore (i.e. transfer/short stop).


BNE > SIN BOOKED PERSONALLY 100%

SIN > LDNFlight departing from the starting point of the UQ trip arriving in a location that passes the

merely incidental rule0%

LDN > BNE Flight departing from a location that passes the merely incidental rule to end point of trip 0%

Note: Singapore is not considered a “visited location” on the return trip home, as Emma is not remaining in Singapore (i.e. transfer/short stop).

Examples of dual purpose travel (International) 20

Example 2.5 Dual purpose travel to one location only Assume the same facts and dates as in Example 2.4.

The only exception is that Emma plans to spend a week on annual leave in London after the conference:


27/11/2016 Sun BNE > SIN Fly to Singapore - remain overnight P

28/11/2016 Mon Singapore Private time P

29/11/2016 Tue SIN >London Fly to London P/B

30/11/2016 Wed London Conference B1/12/2016 Thu London Conference B2/12/2016 Fri London Conference B3/12/2016 Sat London Private time P4/12/2016 Sun London Private time P5/12/2016 Mon London Private time P6/12/2016 Tue London Private time P7/12/2016 Wed London Private time P8/12/2016 Thu London Private time P9/12/2016 Fri London Private time P

10/12/2016 Sat LDN > BNE Fly to Brisbane B11/12/2016 Sun LDN > BNE (Cross date line) L

SingaporePrivate 3 100%

Business 0 0%3

LondonPrivate 7 58%

Business 5 42%12

Lost days: 1 N/A


Accommodation, meals & incidentals and local transport costs incurred by Emma in London between Tuesday (Nov 29) and Friday (Dec 2) will be paid by UQ.

Any accommodation, meals & incidentals and local transport incurred by Emma in Singapore and during the week long holiday in London must be paid by her (as these are distinctly private costs).

The only exception is the cost of travelling to/from the airport on the Saturday (Dec 10) to return to Brisbane. This will be paid for by UQ.


If separately identified on the invoices, the portion of the airfare costs payable by Emma would be as follows:

Continued over…


BNE > SINFlight departing from starting point of UQ trip

to a location en route solely for private purposes

50%

SIN > LDN Flight departing from a location solely for private purposes to any non-end location 100%

LDN > BNE Flight departing from a location that fails the merely incidental rule to end location of trip 50%

Note: Singapore is not considered a “visited location” on the return trip home as Emma is not remaining in Singapore (i.e. transfer/short stop).


Example 2.5 (cont’d):Alternative

To avoid having to pay 100% of the flight from Singapore to London, Emma could book and pay directly for her Brisbane to Singapore flight.

The starting point of the UQ trip in this scenario would be Singapore, so the airfare cost to the traveller may be reduced as they would only pay for the following :

The decision for Emma between starting the UQ trip in Brisbane or Singapore will differ depending on the price of each flight.


BNE > SIN BOOKED PERSONALLY 100%

SIN > LDNFlight departing from starting point of UQ trip

to a location en route that fails the merely incidental rule

50%

LDN > BNE Flight departing from a location that fails the merely incidental rule to end location of trip 50%

Examples of dual purpose travel (International)Example 3.1: Dual purpose travel to multiplelocations (same Country)Andrew, an employee of UQ, is travelling to the USA. He has conferences in Seattle, Boston and Orlando. After the conference in Orlando, Andrew’s family will join him there for a week long holiday at Disneyworld in Orlando. They will then fly home. His itinerary is as follows:

22


2/10/2016 Sun BNE > LA > SEA Fly to Seattle via LA (transit) B

3/10/2016 Mon Seattle Conference B4/10/2016 Tue Seattle Conference B5/10/2016 Wed SEA > BOS Fly to Boston (direct) B6/10/2016 Thu Boston Conference B7/10/2016 Fri Boston Conference B8/10/2016 Sat Boston Conference B9/10/2016 Sun Boston Conference B

10/10/2016 Mon BOS > MCO Fly to Orlando (direct) B11/10/2016 Tue Orlando Conference B12/10/2016 Wed Orlando Conference B13/10/2016 Thu Orlando Conference B14/10/2016 Fri Orlando Private time (Disneyworld) P15/10/2016 Sat Orlando Private time (Disneyworld) P16/10/2016 Sun Orlando Private time (Disneyworld) P17/10/2016 Mon Orlando Private time (Disneyworld) P18/10/2016 Tue Orlando Private time (Disneyworld) P19/10/2016 Wed Orlando Private time (Disneyworld) P20/10/2016 Thu Orlando Private time (Disneyworld) P21/10/2016 Fri MCO > BNE Fly Orlando to LA & BNE B22/10/2016 Sat Cross date line L23/10/2016 Sun Arrive Brisbane L

Seattle Business 4 100%Boston Business 6 100%

OrlandoPrivate 7 58%

Business 5 42%12

Lost days: 2 N/A


Accommodation, meals & incidentals and local transport costs incurred by Andrew in Seattle, Boston and Orlando (during the conference days) will be paid by UQ.

Any accommodation, meals & incidentals and local transport incurred by Andrew and his family during the week long holiday in Orlando must be paid by him (as these are distinctly private costs).




Continued over…

Flight Scenario Cost to Andrew

Brisbane > Seattle

Flight departing from starting point of UQ trip to a location that passes the merely incidental

rule0%

Seattle > Boston

Flight departing from a location that passes the merely incidental rule to a location that passes

the merely incidental rule0%

Boston >Orlando

Flight departing from a location that passes the merely incidental rule to a location that fails the


Orlando >Brisbane

Flight departing from a location that fails the merely incidental rule to end location of trip 50%

Los Angeles is only for transfer and is not considered a ‘visited location’ in this trip.


Example 3.1 (cont’d):Alternative

To avoid having to pay 50% of the flight from Orlando to Brisbane, the traveller could change their itinerary and fly from Orlando back to Boston and then home from Boston to Brisbane. In this scenario, the cost to the traveller would most likely be reduced as they would only pay for the following:

Flight Scenario Cost to Andrew

Brisbane > Seattle

Flight departing from starting point of UQ trip to a location that passes the merely incidental

rule0%

Seattle > Boston



Boston >Orlando

Flight departing from a location that passes the merely incidental rule to a location that fails the


Orlando >Boston

Flight departing from a location that fails the merely incidental rule to a location that passed

the merely incidental rule 50%

Boston >Brisbane

Flight departing from a location that passes the merely incidental rule to end point of trip 0%



Example 3.2: Dual purpose travel to multiplelocations (same Country + gap in between)Assume the same facts and dates as in Example 3.1.

The only exception is that there is now a 4 day gap between the Boston and Orlando conferences. Andrew spends these days holidaying in Chicago before continuing to Orlando.

Refer to the travel itinerary opposite.

Whilst it would be unreasonable to expect Andrew to return to Brisbane for the 4 day gap, he is spending these days in a destination that has no business purpose.


Accommodation, meals & incidentals and local transport costs incurred by Andrew in Seattle, Boston and Orlando (during the conference days) will be paid by UQ.

Any accommodation, meals & incidentals and local transport incurred in Chicago or during the week long holiday in Orlando must be paid by the traveller (as these are distinctly private costs).

Continued over…

Date Day City Activities B/P/L2/10/2016 Sun BNE > LA > SEA Fly to Seattle B3/10/2016 Mon Seattle Conference B4/10/2016 Tue Seattle Conference B5/10/2016 Wed SEA > BOS Fly to Boston (direct) B6/10/2016 Thu Boston Conference B7/10/2016 Fri Boston Conference B8/10/2016 Sat Boston Conference B9/10/2016 Sun Boston Conference B

10/10/2016 Mon BOS > ORD Fly to Chicago - Gap day B/P11/10/2016 Tue Chicago Gap day P12/10/2016 Wed Chicago Gap day P13/10/2016 Thu Chicago Gap day P14/10/2016 Fri ORD > MCO Fly to Orlando (direct) P/B15/10/2016 Sat Orlando Conference B16/10/2016 Sun Orlando Conference B17/10/2016 Mon Orlando Conference B18/10/2016 Tue Orlando Private time (Disneyworld) P19/10/2016 Wed Orlando Private time (Disneyworld) P20/10/2016 Thu Orlando Private time (Disneyworld) P21/10/2016 Fri Orlando Private time (Disneyworld) P22/10/2016 Sat Orlando Private time (Disneyworld) P23/10/2016 Sun Orlando Private time (Disneyworld) P24/10/2016 Mon Orlando Private time (Disneyworld) P25/10/2016 Tue MCO > LA > BNE Fly Orlando to BNE B26/10/2016 Wed Cross date line L27/10/2016 Thu Arrive Brisbane L

Seattle Business 4 100%Boston Business 6 100%

Chicago Private 5 100%


Business 5 42%12

Lost days: 2 N/A

Examples of dual purpose travel (International)Example 3.2 (cont’d):Airfares (distinct & indistinct)


An all-inclusive airfare is not permitted as it would not be possible to split out of the cost of the private component.

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Alternative #1

Instead of flying directly from Chicago to Orlando, the traveller may choose to return to Boston first. In this case, the airfare costs payable by the traveller would be as follows:

Flight ScenarioCost to Andrew

Brisbane >Seattle

Flight departing from starting point of UQ trip to alocation that passes the merely incidental rule 0%

Seattle >Boston



Boston >Chicago

Flight departing from a location that passes the merely incidental rule to a location solely for

private purposes100%

Chicago >Orlando

Flight departing from a location solely for private purposes to any other non-end location 100%

Orlando > Brisbane

Flight departing from a location that fails the merely incidental rule to the end location of the

trip50%



Brisbane >Seattle


Seattle >Boston



Boston >Chicago



Chicago >Boston


Boston >Orlando

Flight departing from a location that passed the merely incidental rule to a location that fails the


Orlando > Brisbane

Flight departing from a location that fails the merely incidental rule to the end location of the

trip50%


Examples of dual purpose travel (International)Example 3.2 (cont’d):Alternative #2

To avoid having to pay 50% of the flight from Orlando to Brisbane, the traveller could change their itinerary and fly from Orlando back to Boston and then home from Boston to Brisbane. In this scenario, the cost to the traveller would most likely be reduced as they would only pay for the following:

26


Brisbane >Seattle


Seattle >Boston

Flight departing from a location that passes the merely incidental rule to a location that passes the


Boston >Chicago



Chicago >Orlando


Orlando >Boston

Flight departing from a location that fails the merely incidental rule to a location that passed the


Boston > Brisbane

Flight departing from a location that passed the merely incidental rule to the end location of the trip 0%


Example 3.3: Dual purpose travel to multiple locations (same Country + gap in between)Assume the same facts and dates as in Example 3.1.

The only exception is that there is now a 4 day gap between the Boston and Orlando conferences. Andrew spends these days sightseeing in Boston and occasionally checking emails before continuing to Orlando. He does not go to Chicago as per Example 3.2.

It could be viewed as unreasonable to expect Andrew to return to Brisbane during that 4 day gap.

However, these ‘gap days’ are still classified as private days when determining whether Boston passes the merely incidental rule (as they do not meet the definition of a business day).

However, as the number of business days in Boston is still greater than 50% (6 business vs 4 private) the merely incidental rule is passed and therefore, the outcome remains the same as presented in Example 3.1.


Example 3.4: Dual purpose travel to multiple locations (same Country + gap in between)Assume the same facts and dates as in Example 3.1.

The only exception is that there is now a 10 day gap between the Boston and Orlando conferences. Rather than doing work or returning home during that period, the employee decides to take annual leave and visit Washington DC and New York City (travelling by train). He then plans to fly to Orlando from Washington DC instead of commuting back to Boston.

Refer to the travel itinerary opposite.


Accommodation, meals & incidentals and local transport costs incurred in Seattle, Boston and Orlando (during the conference days) will be paid by UQ.

Any accommodation, meals & incidentals and local transport incurred during the holidays in New York, Washington DC and Orlando must be paid by the traveller (as these are distinctly private costs).

Continued over…


2/10 Sun BNE > LA > SEA Fly to Seattle via LA (transit) B

3/10 - 4/10 Mon - Tues Seattle Conference 2xB5/10 Wed SEA > BOS Fly to Boston (direct) B6/10 - 9/10 Thu - Sun Boston Conference 4xB10/10 Mon BOS > NYC Train to NYC - gap day B/P11/10 - 16/10 Tue - Sun NYC Gap days 6xP

17/10 Mon NYC > DC Train to Washington DC -gap day P

18/10 - 19/10 Tue - Wed DC Gap days 2xP20/10 Thu DC > Orlando Fly to Orlando (direct) P/B21/10 - 23/10 Fri - Sun Orlando Conference 3xB24/10 - 30/10 Mon - Sun Orlando Private time (Disneyworld) 7xP

31/10 – 2/11 Mon - Wed Orlando > LA > BNE

Fly Orlando to BNE (Cross date line)

1xB2XL

Seattle Business 4 100%Boston Business 6 100%NYC Private 8 100%

Washington DC Private 4 100%


Business 5 42%12

Lost days: 2 N/A

Examples of dual purpose travel (International)Example 3.4 (cont’d):Airfares & train tickets (distinct & indistinct)

If separately identified on the invoices, the portion of the airfare and train costs payable by the traveller would be as follows:


For alternative flights home from Orlando, refer to Example 3.2.

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Flight/Train ScenarioCost to Andrew

Brisbane >Seattle


Seattle >Boston

Flight departing from a location that passes the merely incidental rule to a location that passes the


Boston > NewYork

Train departing from a location that passes the merely incidental rule to a location solely for


New York >Wash DC

Train departing from a location solely for private purposes to any non-end location 100%

Wash DC >Orlando

Flight departing from a location solely for private purposes to any non-end location 100%

Orlando > Brisbane

Flight departing from a location that fails the merely incidental rule to end location of the trip 50%


Questions?

Please contact [email protected]

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***END OF GUIDE***

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uq dual purpose travel guide · uq dual purpose travel guide. as at 12 december 2016 . overview....

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