Whether it's following the mining boom to WA, chasing construction projects in Queensland, or doing a run of commercial fitouts in Melbourne, tradies regularly cross state lines for work. When you do, the tax rules, deductions available, licensing requirements, and employment obligations change — sometimes significantly.

This guide covers the key issues: what you can claim, how long-term interstate projects work for tax purposes, licensing, and how to structure your costs when working away from home.

Tax Deductions When Working Away from Home

Working interstate typically means you're away from your normal place of residence. The ATO has specific rules around what you can claim in these circumstances.

The Key Distinction: Travelling vs Relocating

Travelling for work (FIFO-style, temporary stays): If you travel interstate for work and maintain your permanent home at your usual location, you're "travelling for work." Most costs associated with being away are deductible as work-related travel expenses.

Relocating to work in another state (permanent move): If you move to another state to live and work, you're not "travelling." Costs of the move and living in the new location are largely personal — not deductible. Your permanent home is now your new address.

The grey area (long-term temporary work): Working in another state for 12–18+ months on a long project. The ATO looks at your intention — do you intend to return to your original home, or are you relocating? This distinction matters enormously for what you can claim.

The courts have generally held that if you maintain a genuine "home base" — paying rent or mortgage there, keeping your possessions, returning regularly, maintaining community ties — you can claim travel expenses even on long-term away-from-home work.

What You Can Claim When Working Away

If you're working temporarily interstate (travelling for work, not relocating), you can claim:

Accommodation

The full cost of accommodation (hotel, motel, serviced apartment, rental accommodation) is deductible if you're staying away because of work. Keep receipts for every night.

If you stay with friends or family, you can claim a reasonable amount for the inconvenience to the host — but this is harder to substantiate and riskier to claim without proper documentation.

Meals While Travelling

Meals are deductible when you're away from home overnight for work. The ATO publishes a "Reasonable Amount" for meals that can be claimed without detailed receipts:

2025–26 reasonable daily meal allowances (approximate):

  • Breakfast: $26.30
  • Lunch: $29.55
  • Dinner: $50.35
  • Total daily: approximately $106.20

If your employer (or client) pays a travel allowance that meets or exceeds these amounts, you generally don't need detailed receipts — you can claim up to the reasonable amount. If you're self-employed and receiving no travel allowance, you claim actual costs with receipts.

Flights and Transport

Flights, trains, bus fares, and car travel to get to the interstate work location are deductible. For car travel, use the logbook or cents-per-km rate as applicable.

Incidentals

Laundry, phone calls for work purposes, and minor incidental costs during work travel are deductible. The ATO allows a reasonable amount ($17.85 per day away from home for 2025–26) for incidentals without detailed receipts.

Long-Term Away Situations: The 6-Month "Home Away from Home" Test

If you're away from home for more than 21 days, the ATO starts to scrutinise whether you're genuinely "travelling" or effectively "living" at the work location.

For projects running 6–24 months (common in mining, construction, and infrastructure), the ATO applies additional tests:

Factors supporting ongoing deductibility:

  • You have a genuine home base that you're paying for (rent, mortgage)
  • You return home regularly (fortnightly, monthly)
  • Your family remains at your home base
  • Your mail goes to your home address
  • You're registered in your home state (driver's licence, vehicle registration, electoral roll)
  • The project has a defined end date

Factors the ATO uses to reclassify as "living" at the work location:

  • You've moved your family to the work location
  • You've given up or sublet your home base
  • You've enrolled children in local schools
  • You have no defined return date to your home state
  • You've registered vehicles or updated your licence to the work state

If the ATO determines you've relocated rather than travelled, your accommodation, meals, and travel to the work location are not deductible — they're personal living costs.

The Employer's Allowance and How It Affects Your Claim

If you're an employed tradie working interstate and your employer pays you a travel allowance:

If the allowance is up to the ATO's reasonable amount: You can claim the full reasonable amount as a deduction without detailed receipts, AND you declare the allowance as income. These offset each other — the net tax effect depends on whether you claim the full allowance as a deduction.

If the allowance is below the ATO's reasonable amount: You can claim the difference between what you received and the reasonable amount, provided you spent that money.

If the allowance is above the ATO's reasonable amount: Claim actual expenses (with receipts) — the excess allowance is assessable income.

Living Away from Home Allowance (LAFHA): An Employer Option

If you're an employer with interstate workers (or a director-employee of your own company), the Living Away from Home Allowance (LAFHA) is a fringe benefit that can be provided tax-effectively.

LAFHA provides:

  • Exempt FBT on the first $1,000 per week of additional accommodation costs (above what the employee would pay at home)
  • Exempt FBT on the first reasonable amount of meal expenses

Conditions:

  • The employee must have a genuine home in Australia they're maintaining
  • LAFHA is time-limited (usually up to 12 months, extendable in some circumstances)
  • The employee must provide a declaration confirming they have a home base

For tradie business owners directing themselves on interstate projects, LAFHA can be a legitimate way to receive tax-free reimbursement of interstate costs. Get your accountant's advice before implementing.

GST Registration When Working Interstate

Your GST registration is Australia-wide — it covers all states and territories. You don't need separate GST registrations to work in different states. Your single ABN and GST registration covers all work anywhere in Australia.

However:

  • Your BAS must include all Australian revenue, regardless of state
  • If you're operating under a state-based licence in one state and working in another, ensure your licence is recognised or that you hold the appropriate licence in the work state

State-Based Licensing: The Most Common Interstate Trip-up

Every state has its own licensing requirements for tradies. A Victorian plumber's licence does not automatically allow you to do licensed plumbing work in NSW. A Queensland electrician's licence doesn't cover you in WA.

Current Interstate Licensing Status

Australia has been working toward mutual recognition of trade licences — but the position in 2025–26 is still complex and state-dependent.

Mutual Recognition Scheme: Under the Mutual Recognition Act, some states recognise each other's licences for some occupations. However, automatic mutual recognition doesn't apply to all trade licences in all states, and registration requirements in the new state often still apply.

General guidance:

  • Contact the relevant authority in the work state before starting work
  • Some states require you to register (not just show your home state licence) — registration may be quick and inexpensive
  • Some states require a separate licence application for higher-risk work (gas, high voltage, etc.)

Key Licensing Authorities by State

  • NSW — Service NSW / Fair Trading — Fair Trading NSW — NSW Fair Trading
  • VIC — Energy Safe Victoria — VBA (Victorian Building Authority) — VBA
  • QLD — QBCC (Queensland Building and Construction Commission) — QBCC — QBCC
  • WA — Building and Energy — Building and Energy — Building Commission WA
  • SA — Office of the Technical Regulator — CBS (Consumer and Business Services) — CBS
  • TAS — WorkSafe Tasmania — Consumer Building and Occupational Services — CBOS

Always check the current status directly with the relevant authority — licensing arrangements are subject to ongoing reform.

Superannuation When Working Interstate

Superannuation obligations don't change when you work interstate. If you're an employee, your employer must still pay 11.5% super regardless of which state you work in. If you're self-employed, your voluntary contributions work the same way in every state.

The only difference: workers' compensation is state-based. If you have employees and move them interstate for a project, you may need to review your workers' compensation policy to ensure it covers work in the new state.

FIFO Work and Tax: Special Considerations

Fly-in fly-out (FIFO) work to remote sites is common in the mining and energy sectors. Tax treatment of FIFO work is similar to other interstate travel — the key tests are the same.

Zone Tax Offset: If you work in a remote or isolated area (certain areas of WA, NT, Queensland, SA), you may be entitled to the Zone Tax Offset. This offset provides a modest tax reduction for people who live or work in defined remote zones.

The offset varies by zone:

  • Zone A (most remote): $338 per year
  • Zone B: $57 per year
  • Special areas (extremely isolated): additional amounts

While these aren't large, they're often forgotten. Check the ATO's zone list to see if your work location qualifies.

Practical Example: Tradie on 6-Month Interstate Project

Tom is a Queensland electrician (sole trader) who wins a $340,000 commercial fitout contract in Western Australia. He'll spend 6 months on-site in Perth while his family remains in Brisbane.

What Tom can claim:

  • Flights Brisbane–Perth (and return trips home every 4 weeks): Fully deductible
  • Accommodation in Perth: Fully deductible (serviced apartment at $180/night)
  • Meals while in Perth: Deductible up to the ATO reasonable amounts
  • WA electrician's licence registration (if required): Deductible
  • Additional tools purchased for the WA job: Deductible
  • Phone calls home for work purposes: Deductible (work portion)

What Tom cannot claim:

  • Personal flights for non-work-related trips during the project
  • Personal entertainment in Perth
  • Costs of running his Brisbane home while he's away (those are personal)

Tom's estimated additional deductions from the interstate project:

  • 24 return flights (monthly + occasional) × $450 average: $10,800
  • Accommodation 180 nights × $180: $32,400
  • Meals 180 days × $106 reasonable amount: $19,080
  • Total interstate work deductions: ~$62,280

At Tom's marginal rate of 39%, these deductions save approximately $24,289 in tax — before considering his business income deductions.

Key Records to Keep for Interstate Work

  • Flight receipts and boarding passes
  • Accommodation invoices and receipts
  • Meal receipts (or reasonable allowance diary)
  • Car hire and transport receipts
  • Copies of licences applied for/renewed in the work state
  • Evidence your home base was maintained (continued rent/mortgage payments, return trip records, family remaining at home)
  • Work diaries showing days and locations worked

Keep these for 5 years from the date you lodge the tax return claiming the deductions.

Frequently Asked Questions

Q: I've been working interstate for 2 years — can I still claim travel expenses?
Potentially, if you've genuinely maintained your home base in your home state throughout that time. The longer the period, the more evidence you need that it's a temporary arrangement. Get specific advice from a tax agent who understands long-term away-from-home work.

Q: My employer pays my flights and accommodation — can I still claim anything?
If your employer reimburses or pays for accommodation and flights, those costs are not deductible to you (you haven't incurred them). You may still be able to claim meals and incidentals not covered by your employer.

Q: Can I bring my partner on a work trip and claim their costs?
No. Your partner's travel and accommodation costs are personal — not deductible. If your partner accompanies you on a work trip, only your own costs are deductible.

Q: I'm buying materials in another state — is there anything special for GST?
No. GST is a federal tax, the same rate (10%) in every state. You claim GST credits on business purchases the same way regardless of which state the purchase occurs in.