• Eligibility for car tax concessions

    To be able to claim tax concessions when buying, leasing or modifying a car you must be either:

    Car tax concessions apply only to cars, not other vehicles such as trucks or vans.

    You can use the checklist to work out if you're eligible and the extent to which the tax concessions apply.

    People with disability

    You're eligible for car tax concessions if you both:

    • have a current disability certificate issued by Medibank Health Solutions (MHS) or Health Services Australia certifying that you have lost the use of one or more limbs to the extent that you are unable to use public transport for the next two years, and
    • intend to use the car to travel to or from gainful employment for either two years or 40,000 kilometres from the date you purchase it.

    If you don't have a current disability certificate, you can apply for one by completing an Application for medical assessment to obtain a car or car parts GST-free.

    All new applications must be sent to us for assistance.

    If you receive a permanent certificate, you will generally be able to use it each time you purchase a car or car-part GST-free. If you lose or destroy the certificate, you must obtain a replacement from MHS – you must be reassessed to obtain a replacement.

    If you receive a temporary certificate that has expired, you will need to make another application before purchasing another car GST-free.

    • You cannot claim tax concessions if you:
    • are not gainfully employed
    • purchase the car jointly with another person, such as a spouse or carer
    • want to use the car to look for gainful employment
    • work as a volunteer only
    • are a student only.

    Gainful employment

    In order to be eligible for tax concessions, a person with disability is said to be 'gainfully employed' if both of the following apply:

    • you regularly undertake paid work or work in your own business
    • the payment you receive is appropriate for your age, experience and capabilities.

    Veterans

    An eligible veteran is someone who satisfies both of the following:

    • you are a veteran with a disability
    • you intend to use the car either for your personal transportation for two years, or to travel 40,000 kilometres, from the date you purchase it.

    You are eligible for tax concessions if you have served in the Australian Defence Force or any other Commonwealth armed force, and as a result of that service any of the following apply:

    • you lost a leg or both arms
    • a leg or both arms are permanently and completely useless
    • you receive a totally and permanently incapacitated (TPI) pension
    • you receive a Special Rate Disability Pension.

    To show that you are eligible, you can either:

    Even if you have a gold repatriation health card, you cannot purchase a car GST-free if you are any of the following:

    • a cadet
    • a cadet’s officer
    • a cadet’s instructor
    • a ‘declared member’.

    Checklist

    If you are purchasing or leasing a new or used car, this checklist will help you work out if you are eligible for concessions on GST or LCT.

    1. Have you served in the Australian Defence Force or any other Commonwealth armed force? (If you are a cadet, officer of cadets, instructor of cadets or a ‘declared member’, you do not meet this requirement and must answer No).

    2. As a result of that service, do any of the following apply:

    • you lost a leg or both arms
    • a leg or both arms are permanently and completely useless
    • you receive a totally and permanently incapacitated (TPI) pension
    • you receive a special rate disability pension?

    Yes - Go to question 4

    No - Go to question 3

    3. Do you have a current disability certificate:

    • issued by Medibank Health Solutions (MHS), part of the Health Services Australia Group
    • saying that you have partly, or completely lost the use of one or more limbs and you can’t use public transport?

    Yes - Go to question 5

    No - The car is not GST-free.

    4. Do you plan to:

    • use the car for your personal transportation for two years or travel 40,000 kilometres from the date you purchase it?

    Yes - Go to question 6

    No - The car is not GST-free

    5. Do you plan to:

    • use the car for travel to or from gainful employment for two years or 40,000 kilometres from the date you purchase it?

    Yes - Go to question 6

    No - The car is not GST-free

    6. Is the GST inclusive price of the car less than the car limit (see Car limit for this year's limit)?

    Yes - The car is GST-free

    No - Go to question 7

    7. Has the car been modified so you can drive or travel in it?

    Yes - The car is GST-free up to the car limit. You must pay GST on the value of the car above that limit and LCT above the LCT threshold, where the value of the car excludes the cost of modifying the car

    No - The car is GST-free up to the car limit. You must pay GST on the value of the car above that limit and LCT above the LCT threshold

    See also:

    Last modified: 07 Oct 2016QC 33261