Is the allowance taxed?

Partly. A flat cents-per-kilometre payment is treated by the ATO as a car expense allowance, and up to the ATO approved rate — 91 cents per kilometre for 2026-27 — and up to 5,000 business kilometres for the year, a varied (nil) withholding rate applies. Because the award rate of $1.05 sits above that, 14 cents of every kilometre is subject to normal PAYG withholding (10 cents at the $1.01 rate that applies outside the 1 September 2026 to 28 February 2027 window). Once the employee passes 5,000 business kilometres the concession stops applying to the extra kilometres as well.

What is the minimum km rate under the SCHADS Award?

The SCHADS minimum under clause 20.7(a) is $1.05 per kilometre from the first full pay period on or after 1 September 2026 until 28 February 2027, and $1.01 per kilometre outside that window. Providers may pay a higher rate, but cannot pay less — the cl.20.7(a) figure is a floor, not a guideline.

Is travel between clients paid as working time?

Where the worker remains engaged across the drive, yes — it is worked time and is paid at the applicable hourly rate. The award has no standalone travel-time clause, so the answer follows the engagement rather than a rate for travel: a short drive between appointments is worked time, while a long unpaid gap is a break, not travel. Either way the per-km vehicle allowance is a separate entitlement under clause 20.7(a).

Does travel from home to the first client get paid?

Generally no. The commute from home to your first client and from your last client back home is unpaid and does not attract the km allowance. Travel between clients during the shift is what attracts both travel-time pay and the km allowance.

What happens when a support worker travels between two clients in one day?

Two entitlements can apply: where the worker is engaged across the drive, that time is paid working time at the applicable rate, and the kilometres in the worker's own car attract the vehicle allowance ($1.05/km while the temporary rate applies, $1.01/km otherwise). If there is a long unpaid gap between the two engagements instead of a continuous drive, the day may be a broken shift — adding the $21.81 broken shift allowance and a minimum payment for each portion. Clause 25.6 covers only home care employees and social and community services employees when undertaking disability services work, so check the stream before assuming the allowance is owed.

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Travel & Vehicle Allowance Rates

By CrossVault · Updated 14 October 2026

When employees use their private vehicle for work duties, the SCHADS Award entitles them to a per-kilometre allowance to cover fuel, depreciation and wear-and-tear — clause 20.7(a), currently $1.05/km, as CrossVault's breakdown below explains. The time spent driving is a separate question with a separate answer: the award contains no travel-time clause, so whether the drive is paid turns on whether the worker is still engaged across it. Both can apply to the same trip, but they come from different places in the award. Use the SCHADS travel and km allowance calculator to estimate both amounts.

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Quick Facts

Vehicle Allowance: $1.05/km minimum from the first full pay period on or after 1 Sep 2026 to 28 Feb 2027; $1.01/km otherwise (cl.20.7(a))
Provider Discretion: Rate set by provider, must not fall below SCHADS minimum
Motorcycle: No separate SCHADS rate
Travel Time: No standalone award clause — paid where the worker stays engaged across the drive
Commute: Home to first client / last client to home — generally not paid
Clause: cl.20.7(a) SCHADS Award

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When is it paid?

1. Traveling between different client locations during a shift.
2. Transporting a client in your own car (e.g. for shopping or appointments).
3. Traveling from the office to a client.

Any kilometres recorded against authorised work-related vehicle use should trigger the travel allowance. If a timesheet shows km > 0 and no travel allowance has been paid, that's a default fail under standard SCHADS auditing — pay records need to show either the allowance was paid or that it has been handled in a downstream payroll system.

Is travel to work paid?

Generally, travel from your home to your first client (and from the last client to home) is not paid time and does not attract km allowance. The distinction that catches providers out: travel from home to the first client is the commute (not paid); a drive between two clients that the worker is engaged across during the working day is work (paid at the applicable hourly rate, plus km allowance). Many providers either pay nothing for travel at all, or pay everything including the commute — both are wrong.

Provider rate vs SCHADS minimum

The vehicle allowance rate is set by the NDIS provider but must not fall below the SCHADS minimum in clause 20.7(a). That minimum is $1.05/km, a temporary rate set by [2026] FWCFB 224 that applies from the first full pay period on or after 1 September 2026 until 28 February 2027; outside that window it is $1.01/km. Providers can pay a higher rate, and that's fine — the floor is the issue. Within the window, paying below $1.05/km is a breach regardless of contract terms or what the worker has agreed to, including a legacy $1.01 rate that has not been stepped up. The SCHADS Award sets a single per-km rate under clause 20.7(a) — there is no separate motorcycle rate.

Travel time vs km allowance

These are two different entitlements with two different sources, and both can apply to the same trip. The km allowance is express: clause 20.7(a), $1.05 per kilometre, a contribution to vehicle running costs. The time is not — the SCHADS Award has no travel-time clause, so a drive is paid because the worker remains engaged across it, not because a clause says travel time is paid. Clause 25.6(c) does part of that work: where a break falls within a minimum payment period under clause 10.5, it counts as time worked. So a 30-minute drive between two Saturday clients covering 25km, with the worker engaged throughout, should produce 30 minutes at the Saturday rate plus 25 × $1.05 = $26.25 in vehicle allowance. Where the gap between clients is long and unpaid rather than a continuous drive, it is not travel time at all — it is a break, and the day may be a broken shift instead. For how the kilometre payment itself is taxed, see our guide to the km allowance tax treatment.

Common compliance traps

From our roundup of the seven most common NDIS payroll mistakes, this is Error 7. The recurring patterns:

Treating every inter-client drive as unpaid by default. Workers are paid only for time inside a client's home, and the drive between two clients during a working day is stripped out. Where the worker is engaged across that drive, it is worked time and must be paid.
Paying km allowance but not the time (or vice versa) — they answer different questions, and both can apply to the same trip.
Paying the commute. Less common, but some providers pay km from home to the first client. That's overpayment, and removing it later creates a dispute.
Paying below the floor. From the first full pay period on or after 1 September 2026 until 28 February 2027 the floor is $1.05/km, so a payroll rule still set to $1.01 underpays by 4 cents per kilometre. It also happens when a legacy rate hasn't been indexed.
Km recorded with no allowance line item. If a timesheet shows kilometres traveled but no corresponding allowance expense, payroll has either missed it or processed it in a separate downstream system — either way it needs to be reconciled.

To check kilometres and allowances on your own timesheet export, run it through the free timesheet check.

How this interacts with overtime

Where the drive is worked time, it counts towards the overtime thresholds in cl.28.1 like any other worked time. For part-time and casual employees, all time worked over 10 hours per day or per shift is overtime (cl.28.1(b)(ii)): if a worker is rostered for a 9-hour shift plus 1.5 hours of inter-client travel they are engaged across, that's 10.5 hours of work in the day, and the 0.5 hour beyond the 10-hour threshold is overtime — 150% for the first 2 hours, then 200% (for a casual, 175% then 225% of the base rate, because the 25% casual loading is added to the base rather than multiplied). Full-time employees have a different trigger: cl.28.1(a) pays overtime for all authorised work done in addition to rostered ordinary hours, so travel that is not part of the roster is overtime from the first minute. Many providers track travel as a separate line item and forget to include it when calculating overtime triggers.

Common Questions

Frequently Asked Questions

Is the allowance taxed?: Partly. A flat cents-per-kilometre payment is treated by the ATO as a car expense allowance, and up to the ATO approved rate — 91 cents per kilometre for 2026-27 — and up to 5,000 business kilometres for the year, a varied (nil) withholding rate applies. Because the award rate of $1.05 sits above that, 14 cents of every kilometre is subject to normal PAYG withholding (10 cents at the $1.01 rate that applies outside the 1 September 2026 to 28 February 2027 window). Once the employee passes 5,000 business kilometres the concession stops applying to the extra kilometres as well.
What is the minimum km rate under the SCHADS Award?: The SCHADS minimum under clause 20.7(a) is $1.05 per kilometre from the first full pay period on or after 1 September 2026 until 28 February 2027, and $1.01 per kilometre outside that window. Providers may pay a higher rate, but cannot pay less — the cl.20.7(a) figure is a floor, not a guideline.
Is travel between clients paid as working time?: Where the worker remains engaged across the drive, yes — it is worked time and is paid at the applicable hourly rate. The award has no standalone travel-time clause, so the answer follows the engagement rather than a rate for travel: a short drive between appointments is worked time, while a long unpaid gap is a break, not travel. Either way the per-km vehicle allowance is a separate entitlement under clause 20.7(a).
Does travel from home to the first client get paid?: Generally no. The commute from home to your first client and from your last client back home is unpaid and does not attract the km allowance. Travel between clients during the shift is what attracts both travel-time pay and the km allowance.
What happens when a support worker travels between two clients in one day?: Two entitlements can apply: where the worker is engaged across the drive, that time is paid working time at the applicable rate, and the kilometres in the worker's own car attract the vehicle allowance ($1.05/km while the temporary rate applies, $1.01/km otherwise). If there is a long unpaid gap between the two engagements instead of a continuous drive, the day may be a broken shift — adding the $21.81 broken shift allowance and a minimum payment for each portion. Clause 25.6 covers only home care employees and social and community services employees when undertaking disability services work, so check the stream before assuming the allowance is owed.

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