In order to claim either all or part of travel and accommodation expenses, there must be a sufficient connection between these expenses and generating revenue for your business.
If an overseas trip contains a private/holiday element, an apportionment of the costs will be required. In relation to airfares, when the holiday element is minor and incidental to the business purpose of the trip, the IRD may allow the full claim for the cost of the airfare. However, if there are clearly two advantages sought (i.e. business and private), an apportionment will be required for the cost of the airfare.
The IRD may request information to support a claim for overseas travel expenses. We recommend that you keep a detailed diary recording daily movements, business contacts visited, business cards, business conducted, diversions from the business itinerary for private purposes, items of expenditure and the total cost of the trip. An apportionment between deductible travel expenses and non-deductible private expenses should be made. This calculation should be based upon the number of days of travel and the number of days applying to business.
Overseas travel does not generally attract New Zealand GST, therefore a GST claim cannot be made for these expenses.