If you use your car for work, you may be able to claim a tax deduction – but you will need to own the car. If your employer owns the car or it’s packaged in a salary package, you will be unable to make a claim.
There are two methods for making car claims:
METHOD 1: CENTS PER KILOMETRE
- This method applies a set rate for your business kilometres, up to a maximum of 5,000 kilometres per vehicle, per year.
- If you travel more than 5,000 kilometres, you might want to consider using the Log Book Method instead.
- The cents per kilometre claim is calculated by multiplying your business kilometres travelled (up to 5,000 per vehicle) by the set rate of 88 cents per kilometre for the 2024/25 year.
- You do not need written to keep receipts, but you need to show that you did travel the claimed kilometres. A diary showing work journeys (including the kilometres travelled) will be sufficient.
METHOD 2: LOGBOOK
- This method is based on your business use. It’s determined from your log book and must have been kept for a minimum of 12 weeks, and must be updated every five years. With the logbook method, we calculate the total cost of running your car including depreciation and interest (if you have a loan) and apply the percentage established by your log book.
- The logbook must record all trips made in the car over a representative 12 weeks showing:
- Log book strat and end dates
- Odometer readings at the start and also at the end
- Total kilometres travelled in the 12 weeks
- The calculation of the business percentage
- For each journey in your logbook, you should record:
- start and finishing date and time
- Start and finshing odometer reading
- Kilometres travelled for the trip
- Reasons for the trip
- If you make two or more trips on the same day (you can record them as a one trip)
You need to keep your receipts for the entire year. this includes insurance, & repairs. Fuel can be estimated using the start and end odometer readings for the year, indicating the total kilometres travelled. Depreciation is calculated as a percentage of the written down cost of the car.
If you use a car owned by someone elsesomeone else, you might be eligable to claim the cost incured like fuel.
YOU CANNOT CLAIM
The cost of usual trips between home and work as that travel is considered private, even if
- you complete minor jobs on the way to or from work, like picking up the mail or
- if you return back to work for a call out
- You cannot claim kilometers travelled because you work overtime and no public transport is available to use to get you home.
A number of logbook apps are available including Vehicle Logger & GOFAR.
If you are unsure about a claim, keep the receipt and ask us about the claim at tax time.
