Are your car expenses tax deductible?

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Many people need to travel for work. It can simply be a meeting with a client for a few hours or an overseas or interstate trip which can last for a couple of days.

The expenses that people incur while they travel for work can be tax deductible but the law can be quite complex and the ATO is strict about people making incorrect travel claims. You have to do it right.

If you have to use your car as part of your job, you can claim for a deduction for your expenses, excluding the costs of the commute from your home to work, except in some circumstances like when you use your car for work and travel directly from one work to a second job as long as you do not go home first.

You may also be able to claim for deductions if you travel between workplaces on the same working day. This happens when the company has separate working areas and buildings. You are eligible to claim if you travel to work-related areas and to business-related meetings with clients, suppliers and prospects.

You can make the claim through a flat rate per kilometer for every kilometer that you cover. To do this, you should have a journal of all your work-related travels. This method can cover only up to 5,000 kilometers per car.

Another way to claim the actual costs you incurred is the logbook method. You have to keep the records of your fuel, servicing, depreciation and insurance such as invoices and receipts so you can claim the right percentage of the cost after you complete your tax return.

What can you do?

If you would like to know more about tax deductibles and claims, you can click here to know more about Chan & Naylor services. You can leave your details here and we can schedule you for a free consultation. We’ll contact you to explain more.

Whether you are a beginner, seasoned investor or business owner, we can give you guidance to maximise the financial areas of your life. We can give you an integrated and tailored solution of your superannuation, taxation, property investment, asset protection, estate planning and more.

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Chan & Naylor Group has nationwide offices in Brisbane and Capalaba in Queensland, Melbourne and Moonee Ponds in Victoria, East Perth in Western Australia, and South West Sydney, Parramatta, Pymble, North Sydney, and Sydney in New South Wales.


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