ATO Tax Time focus on car claims

While a taxpayer may have legitimately driven 5,000 kms or more for business purposes and claim their expenses using a cents per kilometre method, they need to be able to justify how they arrived at that number of kms.   Travel from home to work is generally not deductible unless there is a requirement to carry bulky equipment and no place at the job site to lock it up.

Evidence of the number of kilometres driven might be via a diary entry, logbook, electronic records, or evidence of regular work trips over a set distance (for example driving between two work sites).

If a taxpayer wishes to claim using the logbook method, a logbook should be kept for a continuous 12 week period and must be representative of the car travel for the whole year.  A valid logbook can last for 5 years unless the business percentage had varied significantly.  Taxpayers can then claim the business use percentage of all car expenses as a deduction.

Taxpayers should also keep odometer readings at the start and end of every tax year.

If you have any questions, or require assistance with calculating your car expenses this financial Year please contact your usual Mazars advisor or alternatively speak our tax teams on:

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