1051526438078 | Legal database

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This edited version has been archived due to the length of time since original publication. It should not be regarded as indicative of the ATO's current views. The law may have changed since original publication, and views in the edited version may also be affected by subsequent precedents and new approaches to the application of the law.

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Edited version of private advice

Authorisation Number: 1051526438078

Date of advice: 11 June 2019

Ruling

Subject: Income tax - Deductions - Car parking expenses

Question

Are you entitled to a deduction for monthly car parking fees you incur parking your employer provided car near your workplace?

Answer

No.

This ruling applies for the following period:

Year ended 30 June 20XX

Year ending 30 June 20XX

The scheme commences on:

1 July 20XX

Relevant facts and circumstances

You are employed by a company.

The company provides you with a car to use to visit clients during the work day.

This car is assigned to your position not as an individual employee.

Your colleague's also have use of this car during work hours to visit clients.

The company does not reimburse you the monthly car parking fee.

You pay $XXX a month to park the car near your workplace.

Yu use the car for private purposes out of hours and weekends.

You pay a monthly post tax contribution to use the car for private use.

Relevant legislative provisions

Income Tax Assessment Act 1936 Section 51AF

Reasons for decision

Section 51AF of the Income Tax Assessment Act 1936 (ITAA 1936) specifically denies any deductions for expenses relating to a car which is provided by an employer to an employee for his or her exclusive use and the employee is entitled to use it for private use.

Section 51AF of the ITAA 1936 states:

Where:

(a) During a particular period, an employer provides a car for the exclusive use of a person who is, or of persons any of whom is, an employee of the employer

or a relative of such an employee; and

(b) at any time during that period, the employee or a relative of the employee is entitled to use the car for private purposes;

a deduction is not allowable under this Act in respect of a car expense that relates to the car and:

(d) is incurred by the employee and is wholly or partly attributable to that period.

Car has the meaning under Section 995-1 of the Income tax Assessment Act 1997 (ITAA 1997) and states:

Car means a motor vehicle (except a motor cycle or similar vehicle) designed to carry a load of less than 1 tonne and fewer than 9 passengers.

Motor vehicle means any motor-powered road vehicle (including a 4 wheel drive vehicle).

Car expenses has the meaning under section 28-13 of the ITAA 1997 and it states:

28-13(1)

A car expense is a loss or outgoing to do with a *car.

28-13(2)

In addition, any of the following is a car expense:

(a) a loss or outgoing to do with operating a *car;

(b) the decline in value of a car.

Your employer provides you and your colleagues with the use of a car to carry out your work commitments and for personal use.

You incur parking fees to park the car near your workplace and so you and your colleagues can come and go from the parking area throughout the day.

Section 51AF of the ITAA 1936 specifically denies you a deduction for the car parking fees as set out above as the car is your employers.

You are not entitled to claim the monthly parking fees as a deduction.

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