Cents per kilometre deduction for car expenses – 2023 income year
The ATO has proposed for individual taxpayers that use the cents per kilometre method when calculating tax deductions for their work-related car expenses, that the rate per kilometre for the income year starting 1 July 2022 (the 2023 income year) will be 75 cents per kilometre.
This is an increase from the 72 cents rate applicable for both the 2021 and 2022 income years.
A reminder that the ability to claim a deduction under the cents per kilometre method is subject to a cap of 5,000 business kilometres annually.
Individual taxpayers will claim deductions for work-related car expenses (where eligible) under one of two alternative methods: the log-book method or the cents per kilometre method.
Many taxpayers find that they are not able to use the log-book method as they have not maintained a valid 12-week logbook in the last five years.
To find out more, please contact your accountant at our office on 1300 363 866.