Independent LawnMowing Contractors Of Australia Forum
Results 1 to 11 of 11

Thread: Tax implications for work vehicle

  1. #1
    Senior Member AL73's Avatar
    Join Date
    Oct 2010
    Location
    Upper Beaconsfield Victoria
    Posts
    198

    Default Tax implications for work vehicle

    Hi all sorry if theres already a thread. Just wondering how you guys go about claiming your work vehicles when it comes to tax time.
    At the moment the vehicle I am using I own outright so I am just logging down Km's used. I am going to upgrade soon but am unsure if it is better to buy vehicle outright or finance through Nissan etc and claim the repayments. I will talk to my accountant but any advice would be appreciated.

    Regards
    Alex

  2. #2
    Junior Member Big Block Services's Avatar
    Join Date
    Dec 2010
    Location
    Blue Mountains Foothills
    Posts
    15

    Default Re: Tax implications for work vehicle

    Although im new to this industry i have been in business for a long time. Everything i do i talk to my accountant first, and i mean everything. I realy get my monies worth out of him. Phone him to discuss small and big things, phoned him when we wanted to buy a new dinning table once telling asking if we can put that on the company name, he might hate it but my agreement has always been a yearly service with him. Including Bas, Co. and private tax returns.
    What ive noticed is the accountant uses diffrent expensing methods and advises me different purchasing method hire purchase, lease, buy etc depending on my turn over or projected turn over.

    Talk to your accountant, best advise.
    Zak
    BBS

    Impossible is just a big word thrown around by small men. Impossible is not a fact. It's an opinion. Impossible is nothing.

  3. #3
    Member of Forum Stripes's Avatar
    Join Date
    Oct 2008
    Location
    Baulkham Hills
    Posts
    1,544

    Default Re: Tax implications for work vehicle

    As BBS said its best to talk to your accountant.
    It depends on your situation as far as what is best for you to do. If you have a mortgage you are better off putting any extra cash you have on your mortgage to reduce your personal interest that you can't write off, and get a loan or lease for your biz expenses where you can write off some income to reduce tax, or if you have an investment property(s) and no mortgage you wont be paying much tax anyway so it may be better to buy it outright.

  4. #4
    Senior Member AL73's Avatar
    Join Date
    Oct 2010
    Location
    Upper Beaconsfield Victoria
    Posts
    198

    Default Re: Tax implications for work vehicle

    Thanx BBS/Stripes. Time to ring the accountant me thinks!!

  5. #5
    Senior Member glassngrass's Avatar
    Join Date
    Apr 2007
    Location
    Whittlesea, Vic
    Posts
    1,419

    Default Re: Tax implications for work vehicle

    There are several methods that can be used for calculating vehicle expenses- the cents per km being just one. I believe there is a limit of up to 5,000 km (of business use) that can be claimed.

    I chose to use the actual expenses method as I use 100% for business and can easily justify this.
    You should keep a log book to prove your useage pattern.
    If my log book showed 70% business use, the the accountant could claim 70% of actual expenses.

    Whether it is your family vehicle that is also used for business, or a business vehicle also used for private (fringe benefit), if you record ALL your actual vehicle expenses (rego, insurance, maintenance, car wash as well as fuel) AND keep a log book (during peak time of course) then let your accountant select the method that gives you best result.
    David
    Mr Sparkle Car Spa

  6. #6
    Member bellarinelawns's Avatar
    Join Date
    Mar 2007
    Location
    Victoria
    Posts
    98

    Default Re: Tax implications for work vehicle

    Buy a new vehicle. if registered for GST, you get the GSt back straight away, about $1900 on a $20,000 vehicle..so thats a handy pickup. Buy near end of financial year, your accountant then claims the depreciation for the whole 'first year", which is about 30%, so another handy pick up. if the vehicle is 100 % work vehicle, the full expenses are claimed. my vehicle is 100%...it is now out of warranty, I've had it over 3 yrs, I now do my own servicing, but i claim my wifes car services as an expense on business. As my gross income is high , these little extras aren't noticed as being excessive. its important to keep your income to expense ratios reasonable and you shouldn't come unstuck with the tax office. also don't feel to guilty about not declaring some of your cash jobs as taxable income because your paying 10% (remember GST) of it as tax anyway when you spend it .

  7. #7
    Senior Member AL73's Avatar
    Join Date
    Oct 2010
    Location
    Upper Beaconsfield Victoria
    Posts
    198

    Default Re: Tax implications for work vehicle

    Thanx GnG and Bellarine, excellent info.

  8. #8
    Member Of Forum MowerRob's Avatar
    Join Date
    Aug 2009
    Location
    Adelaide
    Posts
    537

    Default Re: Tax implications for work vehicle

    Quote Originally Posted by bellarinelawns View Post
    Buy a new vehicle. if registered for GST, you get the GSt back straight away, about $1900 on a $20,000 vehicle..so thats a handy pickup. Buy near end of financial year, your accountant then claims the depreciation for the whole 'first year", which is about 30%, so another handy pick up. if the vehicle is 100 % work vehicle, the full expenses are claimed. my vehicle is 100%...it is now out of warranty, I've had it over 3 yrs, I now do my own servicing, but i claim my wifes car services as an expense on business. As my gross income is high , these little extras aren't noticed as being excessive. its important to keep your income to expense ratios reasonable and you shouldn't come unstuck with the tax office. also don't feel to guilty about not declaring some of your cash jobs as taxable income because your paying 10% (remember GST) of it as tax anyway when you spend it .
    Are you sure u want this on a public Forum, this screams of audit

  9. #9
    Member Tender Lovin Lawn&Garden's Avatar
    Join Date
    Jul 2009
    Location
    Townsville
    Posts
    2,574

    Default Re: Tax implications for work vehicle

    Quote Originally Posted by MowerRob View Post
    Are you sure u want this on a public Forum, this screams of audit
    Thats what i was thinking.
    Tender Lovin Lawn and Garden Care
    We do everything for your lawn and garden with tender loving care
    find us on facebook under Tender Lovin Lawn and Garden Care

  10. #10
    Member Redlandsguy's Avatar
    Join Date
    Aug 2010
    Location
    Wellington Point Qld
    Posts
    260

    Default Re: Tax implications for work vehicle

    I'd be editing it out very very quickly. May not get to them but geez why take the risk!!

  11. #11
    Senior Member Lawn Mowing Professionals's Avatar
    Join Date
    Jan 2010
    Location
    Greystanes NSW
    Posts
    1,252

    Default Re: Tax implications for work vehicle

    Obviously some people just dont care

    Simmo.

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •