Forums > General Discussion   Shooting the breeze...

Income Tax / Vehicle Expenses

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Created by ok > 9 months ago, 6 Jun 2014
ok
NSW, 1089 posts
6 Jun 2014 5:20PM
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Dear Sea-breeze brains trust Im currently running a small carpentry maintenance business as a sole trader doing 95% of the work myself ( no employees ). As it is the end of financial year it means tax time for me :( .
I currently have 3 vehicles 1. 2012 Navara 4WD space cab ute 2. 2004 Mazda Bravo 2WD tray back ute 3. 2013 WR450F Road Reg'd dirt bike.
The 2 cars are classed as commercial vehicles as they can carry over 1000kgs ? The dirt bike is currently classified as my quote vehicle

Im am currently trying to claim on all 3 vehicles however my Accountant is telling me I am only able to claim 100% on one vehicle even though I use all 3 for work.
Number 1 for towing heavy equipment and trailer, Number 2 for collecting rubbish / moving large items and number 3 is used for my quote vehicle as its fuel n maintenance costs are low (actually for having fun though).

The way I see it is I am guilty ( as in having not used all the vehicles 100%) and have to prove my innocence to actually prove that I have used them when it comes to claiming against them.

Soooooo if there is any wise old men / women on here that have or know any ways I can claim all three vehicles or any other useful information when it comes to paying LESS tax it would be greatly appreciated.

At this stage Im currently looking for a new accountant who isn't lazy and knows all the new laws n such to help prevent me paying for the centrelink surf crews new winters wetsuits!!

Thank you in advance?

Towny
NSW, 903 posts
6 Jun 2014 5:33PM
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Last time I got a new car I had to keep a log book and record all journeys to an from work an play, my ute ended up with 80% work 20% play might be hard to claim 3 vehciles 100%

Smithy
VIC, 859 posts
6 Jun 2014 5:34PM
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Not a tax expert but doesn't sound right to be, if you think of a bob cat operator I am sure they would be able claim for the bob cat and their truck. If each vehicle has a specific purpose that the others can't do I would have thought you could claim the portion used for work.

dmitri
VIC, 1040 posts
6 Jun 2014 5:54PM
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make sure your new accountant is a jew

pweedas
WA, 4642 posts
6 Jun 2014 4:59PM
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I thought if you were running a business, you could claim for as many cars, trucks, tractors etc as you used in the business.
BUT,
if any of them are used for private purposes then you have to keep a log book to prove percentage of business use.
If you push the limits such as by claiming 50% business use for your trail bike, they will push back and demand bags of proof on everything.
So, be content with what's reasonable and don't make a welter of it.

Also, to claim a vehicle as a business expense, it has to be registered as a business vehicle, not a family vehicle.
I don't know if NSW makes that distinction but WA does.
You cannot register a car as only for family use (cheaper license) and then claim it as a tax deduction.

Your accountant might be giving you that line because he doesn't want to get caught up in trying to justify your bovine excrement story when the tax man comes knocking.
It doesn't look good on his plate when he is shown to have accepted something which is obviously wrong.

Anyways,.. you can always ask the tax office on what the rules are.

Little Jon
NSW, 2115 posts
6 Jun 2014 7:32PM
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I'm no tax expert but I don't think it matters how many vehicles you have or whether they are commercial vehicles or not. You won't be able to say all 3 are 100% work related as you must use something privately (unless you are rich and you can say you are always working like packer does). Claiming the bike might be stretching things as a farmer, courier or postie would have a bike but a tradie?

Be wary of accountants that give you a better refund. If the ato comes back years later they don't care your accountant gave you the advice its you that will pay if they don't agree with your claims.

But why have 3 vehicles for your business, the navara could do it all?

myusernam
QLD, 6155 posts
6 Jun 2014 7:37PM
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mate I am all for maximising my tax benifit, but by the letter of the law you would have to keep logs for all 3. depreciate etc. Screw that for little reward. what I would do if I was you is just claim the most expensive ute as 100% or close to it (90 is more under radar). and depreciate that (presumably also under finance) the others not worth so much so tax advantages less. You should be able to slip some receipts for the other vehicles in, anything from supercheap , fuel (so long as the same type) etc

Supersonic27
NSW, 235 posts
6 Jun 2014 8:00PM
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Select to expand quote
myusernam said..

mate I am all for maximising my tax benifit, but by the letter of the law you would have to keep logs for all 3. depreciate etc. Screw that for little reward. what I would do if I was you is just claim the most expensive ute as 100% or close to it (90 is more under radar). and depreciate that (presumably also under finance) the others not worth so much so tax advantages less. You should be able to slip some receipts for the other vehicles in, anything from supercheap , fuel (so long as the same type) etc






Best one so far!

Sole trader is the problem. As a company, as long as it can be justified, you can have as many items of plant as you need and can be justified. (e.g ato is looking hard at "non profitable" or "tax neutral" companies)

As a sole trader you can claim one vehicle and, 1tonne and over, 100% deduction with NO logbook required.

As far as the "quote vehicle" motorcycle........ha ha ha ha ha ha ha ah......sorry mate they are not idiots. They will tell you to use your work vehicle that you claim 100% for.



And you have already put yourself in there a bit, one truck for towing.......one for rubbish removal.......get a trailer!


My wife is an accountant and deals with ato virtually daily.......I was a company director and sole trader of my own businesses for many years.

Good luck!

SandS
VIC, 5904 posts
6 Jun 2014 8:42PM
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which vehicle do you use for private use ?

patsken
WA, 713 posts
6 Jun 2014 6:58PM
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Select to expand quote
SandS said..


which vehicle do you use for private use ?


Shanks's pony if the ATO doesn't like his answers when they audit.....

Scoob
WA, 88 posts
6 Jun 2014 7:38PM
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Cover yourself and keep a log book on all three vehicles.

However

Under new rules, you can shoot back from the D. Abbott sacked 3,000 ATO officers. Defenders of allegedly scarce tax revenues, gone

Makes sense



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Forums > General Discussion   Shooting the breeze...


"Income Tax / Vehicle Expenses" started by ok