Cars Tax Concessions – Tax Refund On Spot

To be able to claim tax concessions when buying, leasing or modifying a car you must meet the eligibility criteria.

There are specific documents required to prove you are entitled. Depending on your situation, you may need to get a medical certificate from Medibank Health Solutions. This is a five-step process which involves completing an Application for medical evaluation to obtain a car or car parts GST-free.

There are certain tax exemptions and concessions if anyone buy luxury car. If a person is disability he/she might be entitled for concession. There are specific rules:

To claim for tax concession, when leasing, buying car, you must meet the criteria precise by ATO to qualify for concessions on car tax. There are specific documents necessary to prove the eligibility specifically for disability might require to obtain medical certificate from Medibank Health Solutions.

An individual can claim for purchase of GST –free car if an qualified person with disability and medical prove for that. If he/she satisfy the criteria of eligibility, then can complete statement for exemption of GST-free car or car parts.

For disability, certain medical aids and appliances are exempted for use in car such as wheelchair ramps, wheel chair lifting devices and special seats for disable persons. Only these specific devices are designed for disable persons.

Purchasing a car GST-free

A veteran or person with a disability can buy a car GST-free if they are an eligible veteran or eligible person with a disability.

An eligible veteran is someone that 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.

An eligible person with a disability is someone that satisfies all of the following:

  • you have a disability and have a current disability certificate that
    • is issued by Medibank Health SolutionsExternal Link (MHS), part of the Health Services Australia Group
    • certifies you have lost the use of one or more limbs to the degree that you are not capable to use public transport, and
  • you intend to use the car to travel to or from gainful employment for either
    • two years, or
    • 40,000 kilometers from the date you purchase it.

Exemptions and Concessions for Luxury cars:
Luxury cars have GST inclusive above the value of luxury car threshold. For disable persons there are some exemptions if he/she is involved to buy car and modify as accordingly for special seat and wheelchair ramp. If the value of the car exceeds luxury car tax threshold then the individual would be liable for both GST and Luxury tax car.

For more information on Etax, myTax ATO and online tax return, please contact us at 1300768284 or you can email us at enquiry@taxrefundonspot.com.au

CALCULATE YOUR CAR EXPENSES

12% of original value method

  • Your claim is based on 12% of the original cost of your car or 12% of its market value at the time you first leased it.
  • The cost or value is subject to a car limit for the year you first used or leased the car.
  • Your car must have traveled more than 5,000 business kilometers in the income year (or, if you used the car for only part of the year, it would have traveled more than 5,000 business kilometers had you used it for the whole year).
  • You don’t need written evidence but you need to be able to show how you worked out your business kilometers.

As a joint owner, you can deduct your share of 12% of the cost of the car. For example, where there are two joint owners, you can each claim a deduction of 6% of the cost of the car.

Cents per kilometer method

  • Your claim is based on a set rate for each business kilometer.
  • You can claim a maximum of 5,000 business kilometers.
  • You don’t need written evidence but you need to be able to show how you worked out your business kilometers (for example, by producing diary records of work-related trips).

Where you and another joint owner use the car for separate income-producing purposes, you can both claim up to a maximum of 5,000 kilometers

One-third of actual expenses method

  • Your car must have traveled more than 5,000 business kilometers in the income year (or, if you used the car for only part of the year, it would have traveled more than 5,000 business kilometers had you used it for the whole year).
  • You claim one-third of all your car expenses, including private costs (but excluding capital costs, such as the purchase price, the principal on any money borrowed to buy your car and the cost of any improvements).
  • For fuel and oil costs, you can keep receipts to work out the amounts or you can estimate them based on odometer records that show readings from the start and the end of the period you had the car during the year.
  • You need written evidence for all the other expenses for the car, as well as records that show the car’s engine capacity, make, model and registration number.

As a joint owner, you can deduct one-third of your share of jointly incurred expenses and depreciation, and one-third of expenses wholly incurred by you.

Other travel expenses

Other travel expenses you may be able to claim include:

  • travel expenses you incurred for meals, accommodation and incidentals while away overnight for work, such as going to an interstate work conference (generally, you can’t claim for meals if your travel did not involve an overnight stay)
  • the costs you actually incur (such as fuel costs) when using a borrowed car or a vehicle other than a car for work purposes
  • air, bus, train, tram and taxi fares
  • Car-hire fees.

You may have to show that you have reduced your claim to exclude any private portion of your trip.

Logbook method

  • Your claim is based on the business-use percentage of the expenses for the car.
  • Expenses include running costs and decline in value but not capital costs, such as the purchase price of your car, the principal on any money borrowed to buy it and any improvement costs.
  • To work out your business-use percentage, you need a logbook and the odometer readings for the logbook period.
  • You can claim fuel and oil costs based on either your actual receipts or you can estimate the expenses based on odometer records that show readings from the start and the end of the period you had the car during the year.
  • You need written evidence for all other expenses for the car.

 

For more information on Etax, myTax ATO and online tax return, please contact us at 1300768284 or you can email us at enquiry@taxrefundonspot.com.au