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  • Eligibility for car tax concessions

    You may be able to claim tax concessions when buying or leasing a car or when purchasing car parts. 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 both of the following apply:

    • you 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
    • you 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 the concession 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 have 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 reapply for the concession by completing an Application for medical assessment to obtain a car or car parts GST-free.

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

    You can't 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 can't 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 buying 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).

    Yes – Go to question 2

    No – Go to question 3

    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) or Health Services Australia
    • saying that you have lost the use of one or more limbs to the extent that 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 to 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. LCT is not payable on modifications to a car that is solely for disabled use.

    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: 27 Jun 2019QC 33261