Cents per Kilometre deduction rate change

The ATO will raise the cents per kilometre deduction rate for motor vehicle expenses to 72 cents from the start of 1 July 2020.

The cents per kilometre method currently allows taxpayers to claim up to a maximum of 5,000 business kilometres per car per year, without requiring written evidence.

The impact of COVID-19 and government restrictions will likely be reflected in tax time claims this year, with work-related car expenses claims expected to see a dip.

Work-related travel has been pretty much off the agenda since the beginning of March, so if you take out that four-month period, you’re likely to see those claims go down quite substantially.