The ATO is now looking more closely at motor vehicle tax deductions. Substantiation requirements must be met where a vehicle falls within the definition of ‘motor vehicle’.

A motor vehicle is any vehicle designed to carry a load of less than one tonne or nine passengers. You might be required to substantiate motor vehicle claims even if you consider a vehicle to be commercial or predominately used for business.

To be exempt from the substantiation requirements the vehicle must be excluded from the definition of ‘motor-vehicle’.

Vehicles not considered ‘motor vehicles’ are still required to pro-rata their deductible use where there is private use.

For the 2015/2016 year, the only substantiation methods available will be the set rate per kilometre method and the log book method for claiming personal motor vehicle deductions.

If you have any questions about vehicle deduction substantiation tax requirements, please contact us.