The ATO has proposed for individual taxpayers that use the cents per kilometre method when calculating tax deductions for their work-related car expenses, that the rate per kilometre for the income year starting 1 July 2023 (the 2024 income year) will be 85 cents per kilometre.
This is an increase from the 78 cents rate applicable for the 2022-23 income year.
If you are calculating your tax rate for another year, please use the rate for the income year for which you are claiming a deduction:
- 2024–25: use 88 cents per kilometre
- 2023–24: use 85 cents per kilometre
- 2022–23: use 78 cents per kilometre
- 2020–21 and 2021–22: use 72 cents per kilometre
A reminder to only use this method if you are a sole trader or partnership claiming for a car, and this method is subject to a cap of 5,000 business kilometres annually.
