Calculating car expenses prior to 1 July 2015

If you are claiming up to 5,000 business kilometres you can use either the:

• cents per kilometre method
• logbook method.

If you are claiming for more than 5,000 business kilometres you can use either the:

• logbook method
• 12% of original value method
• one-third of actual expenses method.

After 1 July 2015, you can only use the cents per kilometre and logbook method.

12% of original value method

This method is not available after 1 July 2015.

With this method you could claim 12% of the original value of your car, up to the 'car limit' (which was $57,466 for 2014–15).

If you bought the car you could claim 12% of the purchase price. If you leased the car you could claim 12% of its market value at the time you started leasing it.

Under this method:

• your car must have travelled more than 5,000 business kilometres during the income year
• you don't need written evidence to show how many kilometres you have travelled, but you must be able to show us how you worked out your business kilometres
• you can't claim a separate deduction for your car’s depreciation.

One-third of actual expenses method

This method is not available after 1 July 2015.

With this method you could claim one-third of your car expenses.

Under this method:

• your car must have travelled more than 5,000 business kilometres during the income year
• you must have written evidence of your fuel and oil costs, or odometer readings on which your estimates are based
• you must have written evidence of all your other car expenses.

You must also keep records that show:

• your car’s odometer readings at the start and end of the period of ownership or leasing in the income year
• the car’s engine capacity, make, model and registration number
• how you worked out your business kilometres and any reasonable estimate you made.

For 2014-15 and earlier income years, there are four different methods for claiming work-related car expenses.