# Tax Q - Deductions



## popadee (Sep 27, 2016)

Hi

I have been trying to find this information offline but have found conflicting posts/info.

If you have purchased the vehicle purely for business, and it is registered for Business purposes.

Are you able to claim the repayments on the vehicle as a deduction??

I read some where you can claim a vehicle under 20k, and other sections on the ATO site that you can claim the interest on repayments.

If anyone has any info that would be appreciated..

Regards


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## Jack Malarkey (Jan 11, 2016)

Here is some relevant information from the Australian Taxation Office: https://www.ato.gov.au/Individuals/...aim/Vehicle-and-travel-expenses/Car-expenses/.

I suggest you familiarise yourself with the information I provide and then avail yourself of the services of a registered tax agent, the fee of whom is itself tax deductible.


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## Jack Malarkey (Jan 11, 2016)

There is also relevant information in here:

https://www.ato.gov.au/business/gst...rough-ride-sourcing-and-your-tax-obligations/


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## Jack Malarkey (Jan 11, 2016)

The $20,000 figure you cite relates to the small business instant asset writeoff: https://www.ato.gov.au/Business/Inc...-calculations/?page=5#Instant_asset_write_off.

Interest on a loan to buy an a business asset (including a car) is deductible to the extent to which you use the asset for business purposes. Repayments of principal are not deductible.

If it's interest on a car, this assumes you are claiming on the basis of the logbook method (actual expenses) and not the cents per kilometre method of 66 cents per business kilometre up to 5,000 business kilometres.


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## Instyle (Oct 18, 2014)

Keep in mind the deduction is proportionate to the business use, a minimum of 12 weeks in a logbook will prove the business vs personal use percentage. Simply being registered for business purpose doesn't automatically allow you a 100% deduction.

The other thing to remember is when you sell the business asset, the sale price is inclusive of GST.


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