There is currently only two methods for claiming motor vehicle deductions in your income tax return – i) The Cents per KM method and ii) The Logbook method.
To use the logbook method you have to complete the following tasks:
- Keep a record of your motor vehicle travel over a continuous 12 week period
- Complete a new logbook every 5 years
- Keep records of your motor vehicle odometer readings at the start and end of each and every financial year. (This one is easily missed)
- Complete a new logbook if you change jobs/work role and/or have a change in the work-related use of your motor vehicle
The ATO are taking aim at work related deductions and have recently disallowed a taxpayers motor vehicle deduction claim under the Logbook method because the taxpayer didn’t keep records of their odometer readings each year. In this case it reduced the taxpayers motor vehicle deduction by $6,000.
Please speak with your DFKBKM contact to get more details on motor vehicle deductions.