Cents per kilometre deduction for car expenses – 2023 income year
The ATO has proposed for individual taxpayers that use the cents per kilometre method when calculating tax deductions for their work-related car expenses, that the rate per kilometre for the income year starting 1 July 2022 (the 2023 income year) will be 75 cents per kilometre.
This is an increase from the 72 cents rate applicable for both the 2021 and 2022 income years. A reminder that the ability to claim a deduction under the cents per kilometre method is subject to a cap of 5,000 business kilometres annually.
Individual taxpayers will claim deductions for work-related car expenses (where eligible) under one of two alternative methods: the log-book method or the cents per kilometre method.
Many taxpayers find that they are not able to use the log-book method as they have not maintained a valid 12-week logbook in the last five years.
Get expert advice
Still unsure which method is the most favourable one. Before taking action, speak with a qualified Modoras Accountant so you don’t pay a cent more than you have to. For more information, call 1300 888 803 and speak to one of our accountants.
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