Whether you’re visiting clients, travelling between work sites or delivering goods, using a vehicle for business can result in expenses you may be able to claim at tax time.
Before lodging your tax return, take some time to check which motor vehicle expenses you may be able to claim. You can generally claim the business portion of motor vehicle expenses you incur while running your business, if you have the right records to support your claim.
Depending on your circumstances, you may be able to claim motor vehicle expenses such as:
- fuel and oil
- electricity for charging an electric vehicle
- insurance
- registration
- lease payments
- interest on a motor vehicle loan
- repairs and servicing
- depreciation of your vehicle.
When claiming motor vehicle expenses, remember that you can only deduct the business-related portion of your costs. If you use your vehicle for both business and private purposes, you'll need to exclude private travel from your claim. Private travel may include activities such as school drop-offs, shopping trips and other personal errands.
Records you need to keep
The records you need to keep depends on how you calculate your claim. Generally, you should keep tax invoices, receipts, registration papers, loan or lease documents, and records showing how you worked out your deduction. You need to keep these records for 5 years. They should also be written in English, or easily converted to English.
Keeping a logbook can help you work out your business-use percentage and support your claim. In it, you can record your business motor vehicle use as you go. This can make it easier to calculate your deduction at tax time.
Access free resources
To help you navigate tax time, explore our Tax Time toolkit for small business. It brings together helpful information, tools, calculators and a range of Small business guides in one convenient place, making it easier to prepare, lodge and stay on track this tax time and throughout the year.
You can also build your knowledge through our free, self-paced course on Claiming motor vehicle expenses External Linkusing Essentials to strengthen your small businessExternal Link.
Find out more on how to claim deductions with our Motor vehicle expenses guide.
You can also speak to a registered tax practitioner for advice.
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