Motor Vehicle Claims

When claiming motor vehicle expenses on our tax returns, we all want to ensure that we get the largest deduction possible. There are two methods that can be used to calculate motor vehicle expenses on our tax returns. The shortcut method, and the logbook method.  

The 2 methods 

The shortcut method is where taxpayers can claim up to 5,000km of work travel, for 72 cents per kilometre, making the maximum claimable amount $3,600.  

The logbook method is where taxpayers log their travel over a 12-week period, to calculate the percentage of work travel that they completed. This percentage is then used to calculate the cost per km travelled and can be used for up to five years. 

We have created a downloadable excel file, where you can log your travel and compare it to the shortcut method, to see which one suits you better.  

We often get asked which is better and it depends on your percentage used for your log book and how it compares to the shortcut method. 

Say you travelled 10,000 km and 5,000 were for business you would have a business percentage of 50%. Your claim may look like the below: 

Deduction  Amount 
Repairs  $880 
Insurance  $1,350 
Depreciation at 12.5% of a $60k car  $7,500 
Fuel  $5,200 
Registration  $836 
Total Costs  $15,766 
At 50%  $7,883 


If your business percentage was only 20% then your claim would be under the result of the shortcut method (assuming you travelled at least 5,000km).