Yes, in certain situations you can claim your membership to Virgin Velocity as a tax deduction.
When it comes to tax deductions, business travelers often wonder if they can claim the expenses associated with their Velocity Club membership as a deduction. According to the Australian Tax Office, paid membership to airport lounge programs such as the Velocity Club.
This applies to Velocity Club Lounge memberships purchased by a business for use by employees, as well as membership purchased by individuals.
The ATO has 3 golden rules for what they accept as a valid business deduction for your Velocity Fees:
The expense must have been for your business, available as an allowable deduction and not for private use.
If the expense is for a mix of business and private use, you can only claim the portion that is used for your business.
You must have records to prove it.
If an airport lounge membership is only used for business-related travel, a deduction for the full purchase price can be claimed. However, if the airport lounge membership is used for business-related travel 50% of the time, and the other 50% of the time it is used for private travel, only the business portion (or 50% of the amount) can be claimed as a deduction. The ATO suggests that business travelers who pay for velocity lounge membership keep “a comprehensive business travel diary” to help apportion the deductions between the business and private use of their airport lounge membership.
It’s always a good idea to consult with us if you are unsure about your Velocity membership deduction. On the face of it, it's pretty straight forward 100 flights in a year where you utilised your Velocity club access. During that time you had 20 private flights. Therefore your fees are 80% deductible.
Keep on top of all the latest tax action or even start your tax return now with Australia's easiest online tax return system. Gotax.com.au
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