Date posted: 11/07/2019 2 min read

Submission - Draft operational statements on using Commissioner's Km rate for business use of a motor vehicle

CA ANZ recently submitted on the draft operational statements on using Commissioner’s kilometre rate for business use of a motor vehicle.

Chartered Accountants Australia and New Zealand (CA ANZ) appreciates the opportunity to provide feedback on the draft operational statements. The statements consider the use of the kilometre rate for:

  • Claiming deductions for business running of a motor vehicle (part A); and
  • Calculating the tax exempt portion of a reimbursement paid to an employee who has used their private motor vehicle in their employer’s business (part B).

The underlying objective of introducing the Commissioner’s kilometre rate method is simplification. With this in mind we question whether the approach suggested in the draft operational statements align with simplification principles.

The kilometre rates stated in the Part B exposure draft do not match those in the Part A exposure draft. The rates in Part B are the 2017/2018 rates. It is not clear why the kilometre rates should differ between the two Parts. If this is the Commissioner’s approach we do not support it.