Work related car expenses reform now reality

The changes to car expenses deduction rules announced in the 2015-16 federal budget is now a reality with the legislation passing both houses of Parliament and awaiting Royal Ascent

the changes included

  • Eliminating the 12% of original value method and
    one-third of actual expenses method for claiming
    car expenses;
  • Introducing a single rate for claiming car
    expenses using the cents per kilometre method
    which will initially be 66 cents per kilometre;
  • Limiting the zone tax offset to those whose usual
    place of residence is within a specified zone; and
  • Introducing an annual cap on the FBT
    concessions for salary packaged entertainment
    benefits provided to employees of certain nonprofit

These rules will apply from 1 July 2015.

Employers may want to consider immediately
updating the allowance rates they pay to
employees who are undertaking work related
travel to the new rate of 66 cents per kilometre.

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