Hello!
To start the New Year, we thought it would be a good time to remind you that if you wish to claim a tax deduction for your car expenses, you will need to start keeping a log book (If you haven’t already done so).
Please see below for some information on vehicle log books.
Who needs to keep a log book?
You are required to keep a log book for all vehicles that you use for business or are owned by a company or trust.
The only exemption to this is utility vehicles designed to carry a load over one tonne when the private use is minor, infrequent and irregular.
Why do you need to keep a log book
The ATO expects that most business vehicles will have some private usage which your accountant will allocate at year end using a Fringe Benefit Tax (FBT) Contribution.
The higher your business usage the lower your FBT contribution, the contribution can range from a few hundred dollars to tens of thousands of dollars
If you do not keep a log book you will be required to pay FBT at 20% of the vehicles purchase price
How often do you need to complete a log book and for how long
You should start a log book from when you first purchase a vehicle and keep it for a period of three consecutive months.
This logbook is then valid for a period of five years, however you will need to do a new logbook if your usage changes drastically at any stage.
Where do I get a log book from
You can either
download an app such as Driversnote
use the attached excel template
purchase a paper log book from a post office or stationery provider
It is important to keep a motor vehicle log book to reduce the amount of FBT contributions you will need to make and therefore the amount of tax you will pay.
If you have any queries in relation to this information, please contact our office. For more information from ATO regarding completing a logbook click here. We have created a handy log book template that you can download below:
Comments