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Simplify the car expense substantiation methods

In the 2015-16 Federal Budget, the government announced that it will simplify the car expense deductions for individuals. Under current arrangements, there are four methods for claiming car expenses:

  • Cents per kilometre – capped at 5,000kms
  • Logbook – unlimited kms
  • 12% of original value
  • One-third of actual expenses

To simplify the rules, from 1 July 2015 the government will abolish the one-third of actual expenses method and 12% of original value method. The cents per kilometre method (with the existing 5,000km cap) and the logbook method (with unlimited kms) will remain.

The cents per kilometre method will be simplified to use a standard rate of 66 cents per km rather than a rate based on the engine size of the car.


Griffin & Associates

79 Denham St, Townsville City QLD 4810

Phone 07 4772 6588

Chartered Accountants