Luxury car tax (LCT) applies to cars with a GST-inclusive value that exceeds the LCT threshold ($59,133 for 2012-13). LCT is payable in addition to GST, but it is not payable on the full value of the vehicle - it is payable on 33% of the GST-exclusive value that exceeds the LCT threshold.
LCT also applies to fuel efficient vehicles that are above the fuel efficient car limit ($75,375 for 2012-13).
You account for LCT when completing your activity statement for GST, using the same tax period.
Don't complete the LCT section of your activity statement if you report and pay GST using a pre-printed GST instalment amount (option 3 on the activity statement). We have included your LCT in this amount. You will still need to report LCT payable (1E) and LCT refundable (1F) when lodging your Annual GST return. This is due at the same time as your tax return.
If you report and pay GST annually (option 4), you don't have to report LCT on monthly or quarterly activity statements. You will need to report LCT on your Annual GST return.
Who must pay LCT and who can defer paying it?
You must pay LCT on all luxury cars that you purchase or import unless you quote your Australian business number (ABN) in the approved format to the supplier (or to Australian Customs and Border Protection Service, in the case of importations).
You are entitled to quote your ABN if you intend to use the car only for one of the following quotable purposes, and for no other purpose, as follows:
- holding it as trading stock, other than holding it for hire or lease
- conducting research and development for its manufacturer
- exporting it in circumstances where the export is GST-free.
The LCT becomes due and payable when you on-sell the luxury car or stop using it for a quotable purpose. This might happen if you hold a car as trading stock and start using it for private purposes or if it becomes a capital asset of your business.
Last Modified: Friday, 15 February 2013