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workbook-1205044__340Individual taxpayers have previously enjoyed the flexibility of 4 different methods with which to claim motor vehicle expenses:

  1. Cents per Kilometre method (only available up to 5,000 business kilometres)
  2. 1/3rd of Expenses (only if car has travelled > 5,000 business kilometres)
  3. 12% of Cost of Vehicle (only if car has travelled > 5,000 business kilometres)
  4. Logbook method

From 1 July 2015, the 1/3rd of expenses method and the 12% of cost of vehicle method have been removed.  This means, in many cases, taxpayers will be forced to keep a written logbook for 12 weeks (3 months) to be able to justify the business use proportion of the vehicle.

For those taxpayers who previously relied upon the 1/3rd of costs or 12% of cost methods, we suggest you start to keep a logbook now to substantiate your claim for the 2016 tax year.  Logbooks are valid for 5 years unless the business use changes substantially.

If you would like a Hanrick Curran logbook, please contact us for a free copy.

The cents per kilometre method used to have different rates depending upon the engine capacity of the vehicle.  This has now changed to a single rate of 66 cents per kilometre (up to a maximum of 5,000 kilometres travelled for business).

For more details, please see the Australian Taxation Office website or contact your usual Hanrick Curran advisor.


Please note that this publication is intended to provide a general summary and should not be relied upon as a substitute for personal advice.