You need to keep a record and claim for actual work related travel expenses, such as petrol or diesel costs. Rather than claiming these expenses as car expenses, include them in the travel expenses section of your tax return.
Your tax agent can help work this out for you. Fuel/Petrol without a logbook: Even if you haven't kept a car logbook, as long as you can demonstrate how you calculate the number of kilometres you're claiming, the ATO will allow a claim up to a maximum of 5,000km, using the cents per km method.
If you travel a lot you may want to know how many kilometers or how much fuel you can claim without receipts. You can claim up to a maximum of 5,000 business kilometers without written evidence, such as receipts or logbooks, for the financial year.
It's also the percentage of all of the vehicle expenses paid by you during the year that you're entitled to claim on your tax return. In addition to keeping a logbook, which you can get from most stationers, you also need to keep: Receipts for your fuel and oil use or estimates taken from your odometer readings.
The Logbook Method – Claiming > 5,000km
The Logbook Method is a little more complex than the Cents Per KM Method, and it requires that you keep meticulous records and car expense receipts. You must keep a logbook for at least 12 continuous weeks during one income tax year.
You can claim work expenses up to $300 without receipts IN TOTAL (not each item), with basic substantiation. However, if you claim over $300 you need proper substantiation for all of the amount including the first $300.
You can calculate your mobile phone and data use expenses for a work purpose by: claiming incidental use ($50 or less), with basic records to show how you calculated your claim – you can claim: $0.75 for work phone calls made from your mobile phone. $0.10 for text messages sent from your mobile phone.
To claim donations of more than $10, you need a receipt.
You can claim running costs and decline in value of your car. You must keep: receipts for your fuel and oil expenses, or a record of your reasonable estimate of these expenses based on the odometer readings for the start and end of the period for which you are claiming.
If you use the cents per km rate set by the ATO, you can claim 72 cents per kilometre for the 2021/2022 tax year - keep in mind you can claim up to 5000km. If you use the logbook or actual expenses method, you can claim all your business-related car expenses.
Logbook method
If you are travelling more than 5,000 kms for business during one financial year and planning on claiming car expenses, the ATO requires that you keep a logbook of distance traveled and the purpose for your travel.
Businesses must provide a receipt
Businesses must give consumers a receipt for anything that costs over $75. For anything under $75, the consumer can ask for a receipt, and the business must provide it within 7 days. A receipt can be a: GST tax invoice.
Sole Trader Deductions
Expenses such as fuel, maintenance, and general wear and tear on your vehicle when used for business purposes are claimable tax deductions.
The tax office has approved mileage rate payments which tell you how much tax relief on your petrol or diesel you can claim. The amounts you can claim per mile are: . 45p per mile for the first 10,000 business miles.
You can claim the cost of a device you buy and use for work, such as a: laptop. desktop computer or personal computer (PC) monitor.
You can claim a deduction for parking fees and tolls you incur when you use your car or other vehicle for work-related purposes. You can't claim a deduction for parking at or near a regular place of work. You also can't claim a deduction for tolls you incur for trips between your home and work.
It's not just laptops that can be claimed on your tax return. Items such as desktop computers, modems, monitors, tablets, mobile phones and printers can be claimed. These items are considered capital purchases and may need to be depreciated over a set time, which the ATO determines.
In some circumstances you may not need receipts, but you still need to show you spent the money and how you calculate your claim. Specific exceptions are: Total work expenses $300 or less. Total laundry expenses $150 or less.
The ATO assesses individual tax returns using high-tech cross-checking systems that detect inaccurate and fraudulent deductions.
You must always give your customers a receipt or proof of purchase for anything over $75. A customer can ask for a receipt for any purchases under $75. If they do, you must provide them with a receipt within 7 days of their request.
You can claim a maximum of 5,000 business kilometres per car, per year. You do not need written evidence, but you need to be able to show how you worked out your business kilometres.
Common types of motor vehicle expenses you can claim include: fuel and oil repairs and servicing interest on a motor vehicle loan lease payments insurance registration depreciation (decline in value) of the vehicle.
You need to keep an ATO-compliant vehicle log book that will serve as proof that you have driven the kilometres for business purposes you claim a deduction for. In general, if you use your car frequently for work, the logbook method will result in a larger tax refund than the cents per kilometre method.