Vehicle Expenses For Claiming Deductions

Vehicle expenses are a much regulated area for claiming deductions, so having an understanding of what you can claim is crucial in obtaining the correct deduction. Most of us rely on our cars daily in our working lives and, as we all know, cars can be expensive.  Fortunately, tax deductions are claimable on your car-related expenses if you use your own car, or a car you hire or lease, for work purposes.

To be eligible to claim genuine car expenses, the first step is to work out and record how many of the kilometres travelled are business kilometres. After you have that checked off there are three main methods to choose from with the choice up to you with which one you choose. You may choose the one that gains you the largest deduction provided that you have backed up evidence if the Tax office requests it from you.

The three main options to determine car expense deductions are:

  1. cents per kilometre
  2. 12% of original value
  3. The logbook method.

Method 1: Cents per kilometre

The cents per kilometre method is the most common method used and can be used to claim up to a maximum of 5,000 business kilometres per year. The cents per kilometre method allows you to calculate deductions based on a cent-per-kilometre rate, which depends on your car’s engine capacity. Under this method you do not need written evidence but you may need to be able to show how you estimated your business kilometres. A typical example is where a trade’s person transports bulky tools and equipment to a work site. The rates that apply for the 2013-2014 period are shown below:

Rates per business kilometre
Engine capacity Cents per kilometre
Ordinary engine Rotary engine
1.6 litre (1,600cc) or less 0.8 litre (800cc) or less 65 cents
1.601-2.6 litre (1,601-2,600cc) 0.801-1.3 litre (801-1,300cc) 76 cents
2.601 litre (2,601cc) and over 1.301 litre (1,301cc) and over 77 cents

Method 2: 12% of original value

The 12% of original value method takes that percentage of your car’s initial value as the claimable amount.  An advantage of this method is you can use this method if you used your car to travel more than 5,000 business kilometres in the financial year. If you bought the car, you can claim 12% of the cost. If you leased the car, you can claim 12% of its market value at the time that you first leased it.

Cost of vehicle when purchase: $25000

Deduction to claim in tax return: $25000 x .12 = $3000

You do not need written evidence to use this method but you may need to be able to show how you worked out your business kilometres.

Method 3: The log book method

Using the logbook method, you work out the business or work related usage percentage of your car. This percentage is then applied to claiming all running costs of the car.

You can use this method if:

  • you have a logbook that has been sustained for a minimum of 12 weeks;
  • your logbook is updated every 5 years
  • you have details of the kilometres you have travelled for the logbook period;
  • you have recorded the odometer reading on 30 June (without this, the ATO will refuse your claim).

Keeping a logbook allows you to claim the maximum car deductions, as you can claim all car-related expenses if you have records to verify those expenses.

Records required include:

  1. a logbook
  2. odometer records, and
  3. Written evidence for all your car expenses except fuel and oil costs. For example: registration, repairs, insurance and interest)

A logbook is valid for five years providing it represents current usage patterns, must record at least 12 continuous weeks and must contain the following information:

  • when the logbook period begins and ends
  • the car’s odometer readings at the start and end of the logbook period
  • the number of kilometres travelled for work activities based on journeys recorded in the logbook.
  • the business use percentage for the logbook period.
  • the total number of kilometres that the car travelled during the logbook period.

For more information on myTax 2019, online tax return 2019, myGov 2019, Tax Return 2019 , or any other tax related matter, please call our professional accountant on 1300 768 284 . For more information please contact us at 1300768284 or you can email us atenquiry@taxrefundonspot.com.au

Planning on Developing Property?

Did you know that if you build and sell new residential premises you pay GST on the sale? And you can generally claim GST credits for your construction costs and purchases related to the sale.

We are identifying and contacting developers early on in the planning process to help you understand your GST entitlements and responsibilities.

When a new development starts we sometimes verify significant refund claims. We may do this if you:

  • lodge a BAS without reporting property transactions, or
  • have an outstanding BAS.

If you haven’t lodged your BAS we’ll remind you so you don’t get behind. When we do this we can assist you with any questions you may have.

If you need advice from the ATO about the tax treatment of your development you can lodge a request for a private binding ruling.

Property development, building and renovating

If you’re renovating one or more properties you need to work out if you are a personal property investor, engaged in a profit-making activity of property renovations, or carrying on a business of renovating properties.

If you build new residential premises for sale, you’re liable for GST on the sale, and you can generally claim GST credits for your construction costs and purchases related to the sale.

Register of Private Binding Rulings

We publish edited versions of written binding advice in the Register of Private Binding Rulings.

This enhances the integrity and transparency of the private ruling system and confirms for the recipient that it is official ATO advice. The advice is edited to protect the secrecy and privacy of the applicant.

Status of versions published in the Register

The edited versions of written binding advice published in the Register can’t be relied on by taxpayers or their advisers in any way. They can’t be relied upon as precedent or used for determining how the ATO will apply the law. The records in this Register are not binding and provide no protection.

For more information on myTax 2019, online tax return 2019, myGov 2019, Tax Return 2019 , or any other tax related matter, please call our professional accountant on 1300 768 284 or you can email us at enquiry@taxrefundonspot.com.au

How to Hit Your First Tax Return Deadline

There’s nothing like a deadline to inspire action. So if you’re preparing to lodge your first tax return online, here’s yours: October 31.That’s the date you’ll need to have the whole kit and caboodle sorted if you’re doing it yourself.

Figure out if you need to lodge

It is important to check, because even if you have a casual, after-school job you may not need to lodge a return,” says Australian Tax Office assistant commissioner Graham Whyte.

“For example, if you earned below the tax-free threshold and didn’t have any tax taken out by your employer throughout the year.”

If it turns out you don’t need to lodge a return, you’ll just need to fill out a non-lodgment advice form via the myGov website.

However, if your boss has been deducting tax from your wages, and you’ve earn less than $18,200 over the year, lodge a return as soon as you can. You should get your refund in 12 days or less.

Lodging online

The ATO has two different options. For straightforward returns, use MyTax on your tablet, smartphone or computer.

MyTax automatically fills out tax returns with information provided by employers, banks, government agencies and others. Just double-check the pre-filled information and add any missing details.

For more complex tax scenarios, E-tax is your best bet, and must be accessed online via a PC or Mac.

Creating your online account

If it’s your first time, you’ll need to create an online myGov account. Have your birth certificate, passport or citizenship certificate handy, and follow the steps.

Claim all you can

Self-preparers need to remember three golden rules, Whyte says.

“To get a deduction for a work-related expense you must have spent the money yourself, it must be related to your job and not a private expense and in most cases you must have a record to prove it.

“If you keep that in mind you can’t go wrong.”

For more information on myTax 2019, online tax return 2019, myGov 2019, Tax Return 2019 , or any other tax related matter, please call our professional accountant on 1300 768 284 . For more information please contact us at 1300768284 or you can email us at enquiry@taxrefundonspot.com.au

Federal Budget 2019 -Tax Refund On Spot

Australia’s 2019 Federal Budget has been unveiled. The key features of this year’s Budget were tax cuts and infrastructure spending with the theme of “A stronger economy and a secure future. Here is the people who will get benefit from federal budget 2019 are:
Succeeding generations – The budget predict a return to surplus of $7.1 billion by 2019-20, after more than a decade of deficits since the global financial crisis.
Individual taxpayers – The budget promises a $302 billion package of personal tax cuts to be rolled out over the next decade.
Middle and low-income earners – Immediate tax relief for low- and middle income earners of up to $1,080 for singles or up to $2,160 for dual income families to ease the cost of living.
Small business – The small business instant asset write-off threshold will be lifted to $30 000 and expanded to include businesses with a $50 million turn over. This change applies from 7:30 AEDT on Tuesday night to June 30, 2020.Small business tax cut – For businesses with a turnover of less than $50 million a year their tax rate will be lowered to 25 per cent by 2021-22.
Infrastructure – The budget includes a record $100 billion in funding for transportation around the country over the next decade.
Patients – Extra $7.7 billion over three years to 2022-23 for better access to MRI scans for patients with breast cancer, and $1.4 billion over five years from 2017-18 for new Pharmaceutical Benefits Scheme listings, including medicines to treat spinal muscular atrophy, breast cancer, refractory multiple myeloma, relapsing-remitting multiple sclerosis and a new medicine to prevent HIV.
Medical research future fund – $ 5 billion will be granted to the fund, including $614 million for rare cancers and diseases, $220 million for cardiovascular health, $605 million for clinical infrastructure and $150 million for stem cell research.

Mental health – $737 million has been included in budget over seven years to deliver more services for people living with mental illness, including $461 million for youth mental health and suicide prevention.
Drug addicts and their families – Through it $337 million drug strategy, the Government is hoping to target the harmful effects of ice, alcohol, tobacco and opioids by increasing access to services outside metropolitan areas, funding local family drug support services and include measures to target opioid use.
Parents/children – Preschool education will get a $453 million boost for the 2020 school year.Regional students – $93.7 million will be granted over four years for scholarships to attend regional universities or vocational education.
Regulators – Gain $600 million in funding for the banking royal commission fallout.

For more information on myTax 2019, online tax return 2019, myGov 2019, Tax Return 2019 , or any other tax related matter, please call our professional accountant on 1300 768 284 .

Approaches to Use Your Tax Refund

The end of the financial year implies that numerous Australians will get themselves a couple of thousand dollars wealthier on account of a tax refund. As indicated by the ATO, 77% of taxpayers got an expense form in the 2013/14 money related year with a normal refund amount of $3,630.

A tax refund can give a convenient chance to get your accounts all together, an opportunity to go overboard on something you’ve needed or find something new. The trap is in discovering the right harmony between these contending urges so you don’t feel lament once the cash is spent.

For more information on myTax 2019, online tax return 2019, myGov 2019, Tax Return 2019 , or any other tax related matter, please call our professional accountant on 1300 768 284 .

Leaving the Workforce

For people who are retiring, there are a variety of options for making the change.

Under the change to retirement rules, if you have reached your preservation age you may be capable to decrease your working hours without reducing your income. You can do this by topping up your part-time income with a regular ‘income stream’ from your super savings. If you are over 60 years old, this income stream may be tax free.

On the other hand, you must be alert of the impact this can have on you and your situation. ATO recommends you see a financial adviser, accountant or your tax agent to help you make a decision if this option is right for you.

Employers still need to make essential super guarantee contributions for all their qualified employees – including people who are making the transition to giving up work.

For more information on myTax 2018, myGov 2018, Online Tax Return 2018 , or any other related matterplease contact us at 1300 768 284 or you can email us at enquiry@taxrefundonspot.com.au

GET FREE Tax Refund estimate and Option of getting refund in 1 Hour, prior year Tax returns are also available, Just fill in your basic details on our website at www.taxrefundonspot.com.au or by emailing us on enquiry@taxrefundonspot.com.au we will check your employment history from ATO records, personal visit available at tax refund on spot.

We also have our separate department for Home loan, refinancing, car & truck loan.

When you Can Claim a GST Credit

You must be registered for GST to claim GST credits.

You can maintain a credit for any GST included in the price you pay for things that you use in your business. This is called a GST credit (or input-tax credit, a credit for the tax included in the price of your business inputs).

You claim GST credits in your activity statement.

You can claim GST credits if the following four conditions apply:

  • you aim to use your purchase solely or partly in carrying on your business and the purchase does not communicate to making input-taxed supplies
  • the purchase price included GST
  • you provide, or are liable to provide, payment for the item you purchased
  • You have a tax invoice from your supplier (for purchases more than $82.50).

You cannot claim a GST credit:

  • without a valid tax invoice
  • for purchases that do not have GST in the price
  • for wages you pay to staff (there is no GST on wages)
  • For motor vehicles priced above a certain limit.

Goods and services that don’t have GST in their price include:

  • GST-free items (such as basic foods)
  • Input-taxed items (such as bank fees and loan interest)
  • Purchases from a business that is not registered for GST (and therefore cannot charge GST).

When you can’t claim GST credit

You also cannot maintain GST credits for the following, even if GST is included in the price:

  • purchases you intend to use for private or domestic purposes
  • purchases you intend to use to make input-taxed supplies, such as those associated with providing residential accommodation
  • some purchases that you can’t claim as an income tax deduction, such as entertainment expenses
  • Land purchases under the margin scheme.

For more information on myTax 2018, myGov 2018, Online Tax Return 2018 , or any other related matterplease contact us at 1300 768 284 or you can email us at enquiry@taxrefundonspot.com.au

GET FREE Tax Refund estimate and Option of getting refund in 1 Hour, prior year Tax returns are also available, Just fill in your basic details on our website at www.taxrefundonspot.com.au or by emailing us on enquiry@taxrefundonspot.com.au we will check your employment history from ATO records, personal visit available at tax refund on spot.

We also have our separate department for Home loan, refinancing, car & truck loan.

Senior Australians – Tax Offsets

Mature age workers, seniors and pensioners may be eligible for tax offsets. If you are a short income earner, you may be entitled for an offset and, if your medical expenses pass the threshold limit, you may be entitled for the medical expenses tax offset too. You may also be eligible for an offset if you receive earnings from a superannuation income stream

If you are a Senior Australian, you may be entitled for the seniors and pensioners tax offset.

The seniors and pensioners tax offset (SAPTO) can decrease the amount of tax you are liable to pay. In some cases, this offset may reduce your tax liability to zero and you may not have to lodge a tax return.

To be eligible for this tax offset, you have to meet certain conditions connecting to your income and eligibility for an Australian Government pension.

If you are a senior, you must meet the age requirement for the Age pension to be eligible for the offset.

In some cases, you may also be able to move your eligible spouse’s unused SAPTO to you. We calculate their transfer amount available and include this amount when calculating your SAPTO.

If you have reached the age pension age, the seniors and pensioners tax offset lets you earn more money before you must pay tax or the Medicare levy. There are a range of eligibility circumstances which relate to age, income, and eligibility for Australian government pensions or allowances.

For more information on myTax 2018, myGov 2018, Online Tax Return 2018 , or any other related matterplease contact us at 1300 768 284 or you can email us at enquiry@taxrefundonspot.com.au

GET FREE Tax Refund estimate and Option of getting refund in 1 Hour, prior year Tax returns are also available, Just fill in your basic details on our website at www.taxrefundonspot.com.au or by emailing us on enquiry@taxrefundonspot.com.au we will check your employment history from ATO records, personal visit available at tax refund on spot.

We also have our separate department for Home loan, refinancing, car & truck loan.

Tax Concessions – Cars

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 obtaining medical certificate from Medibank Health Solutions.

An individual can claim for purchase of GST –free car if a 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.

For more information on myTax 2018, myGov 2018, Online Tax Return 2018 , or any other related matterplease contact us at 1300 768 284 or you can email us at enquiry@taxrefundonspot.com.au

GET FREE Tax Refund estimate and Option of getting refund in 1 Hour, prior year Tax returns are also available, Just fill in your basic details on our website at www.taxrefundonspot.com.au or by emailing us on enquiry@taxrefundonspot.com.au we will check your employment history from ATO records, personal visit available at tax refund on spot.

We also have our separate department for Home loan, refinancing, car & truck loan.

 

Small Business Tax Concessions

Small business can access many tax concessions. A business body can be:

  • Individual
  • Partnership
  • Company or
  • Trust

The total turnover of business should be less than aggregate $ 2 million throughout financial year. The benefits can include

Simplified Depreciation rules:

  • In simplified depreciation rule, small businesses can immediately write off their assets valued at less than $20,000.

Simplified trading stock rules:

  • In small business, they got the benefit that if there existing stock value doesn’t go up or down by more than $ 5000, then they can have the facility not to do stock take at the end of year instead of that they can add same stock value as at the start of year.

Car parking and FBT Exemption:

  • Small businesses are exempted car parking benefits if providing for their employees but certain conditions apply.
  • Business should have less than 10 million turnovers in last financial year before the relevant FBT year.
  • Should not public listed company and government body.

GST choice on a cash basis:

  • For eligible businesses they are only responsible to calculate GST once payment received (Cash basis accounting)
  • In small business situation, they are eligible for concession Pay-as-you-go where they can pay quarterly instalments that would worked out as most recently paid tax.

If the business type is included in Simplified Tax System, which is intended for small business concessions can claim concessions if business gather the eligibility criteria.

For more information on myTax 2018, myGov 2018, Online Tax Return 2018 , or any other related matterplease contact us at 1300 768 284 or you can email us at enquiry@taxrefundonspot.com.au

GET FREE Tax Refund estimate and Option of getting refund in 1 Hour, prior year Tax returns are also available, Just fill in your basic details on our website at www.taxrefundonspot.com.au or by emailing us on enquiry@taxrefundonspot.com.au we will check your employment history from ATO records, personal visit available at tax refund on spot.

We also have our separate department for Home loan, refinancing, car & truck loan.