Business running of a motor vehicle
Kilometre rateThe Commissioner has issued a new Operational Statement 18/01 – Commissioner's statement on using a kilometre rate for business running of a motor vehicle.
This updates and replaces Operational Statement 09/01 – Commissioner's statement of use of a mileage rate for expenditure incurred for business use of a motor vehicle, issued in May 2009.
The new rules allow the choice between using the cost method (which is based on keeping records of actual costs incurred) or a kilometre rate method which has replaced the mileage rate method from 1 April 2017.
The kilometre rates for the 2017/2018 income year are as follows:
2017/2018 kilometre rates
|Vehicle type||Tier one rate||Tier two rate|
|Petrol or diesel||76 cents||26 cents|
|Petrol hybrid||76 cents||18 cents|
|Electric||76 cents||9 cents|
Tier one is a combination of the vehicles fixed and running costs. It applies for the business portion of the first 14,000kms travelled by the motor vehicle in a year.
Tier two includes only the running costs. It applies for the business portion of any travel in excess of 14,000kms.