What our
clients say

“When we were looking at buying our business, we got … …More

  • Bennetts Proactive newsdesk

  • Changes to Motor Vehicle Reimbursement Rules

    The government has recently announced changes around the use of a private motor vehicle for business-related expenses.

    Where a motor vehicle is used for business related purposes, a taxpayer must calculate the proportion of business use either using a logbook or actual records by applying one of the two methods:

    For the 2017/18 income year the rates are as follows:

    Tier one is a combination of the vehicles fixed and running costs and applies to the first 14,000kms travelled each year; Tier two includes only the running costs and applies for the business portion of any travel in excess of 14,000kms in an income year.

    Taxpayers are unable to switch between the two methods, therefore, the method used will apply until the vehicle is disposed of, but it can be applied on a vehicle-by-vehicle basis.  Adequate records must be kept to support the claim for tax purposes.

    A company may also use these methods as an alternative to paying FBT where a motor vehicle is made available to a Shareholder Employee.

    If you think this may apply to you please contact your Accounting Specialist, Lance or Michelle.  We will also host a client presentation around the options available for tax purposes for motor vehicles shortly.

     

    MENU