Jul 8, 2015
Are you using car for work? If yes then do you know that one can claim car expenses as tax deduction. If you are using car for going to work, then it means you are using car for job, that is business cost and so you can claim that car expense in you tax deduction list. Check out how and what you can claim in this section.
How to claim car expenses as tax deduction?
The taxpayer can claim the cost of trips only between home and workplace where:
1. They had used their car for carrying heavy tools or equipments which is meant to use for work that can’t be left at workplace eg:- an extension ladder or cello.
2. Using your home as work from home and then using your car for travelling to workplace with the same employer for some meetings or continuing the work.
3.Different onsite areas as work location can also be claimed while travelling more than one site every day before returning back home. Taxation Ruling (TR) 95/34 says that Employees carrying out itinerant work has more information on travel expenses for employees who have shifting places of employment.
4.Using your car for travelling between two jobs, from one workplace to another in a day.
What you can’t claim?
The taxpayer cannot claim the cost of trips between home to workplace, because those expenses are considered as private expense. One cannot claim:
1. The car expense for doing minor work-related tasks like picking up the mail on the way from work or home.
2. If they have to travel to between home and work more than once a day.
3. If the taxpayer is on leave or not working on a particular day and due to some sudden work, if the employer contacts them for work and they had to travel from home to work.
4. If they don’t have public transport near by taking them from home to work.
5. If on a particular day they are working extra hours after regular work hours taking over time or other shift work.
6. If your home is your workplace itself or a business place. Travelling to home – so called workplace from other places.
Consider each and every point and claim your tax accordingly. Small things makes a lot of difference. Understand one thing Car expenses and using your car for work expenses both comes in different category. Car expenses comes in overall major tax deduction area and using your car for work can be claimed only if you follow rules of taxation of travelling to work and home.
