Business Alert at 9:00am with CVA – ATO Clamps Down on Work Vehicles

Clear Vision • July 17, 2018

ATO Clamps Down on Private Usage of Work Vehicles

Minor, Infrequent, Irregular; these are the words to remember…

The law as it relates to FBT on work-related vehicles remains the same; it’s about minor, infrequent and irregular travel for work vehicles. New guidelines however are providing clarity around what the ATO expects employers to do in demonstrating the private use of work vehicles.

The onus is very much on you as the employer to prove that work cars are not used as a perk to retain and attract staff.

Guidelines to consider include:-

  • A vehicles private use cannot exceed 1000km in a year, and no return journey can exceed 200km.
  • Any trip in which a home to work route varies by more than 2km will be considered a personal trip.
  • Have a policy in place on work-related travel and make sure you enforce it.

The ATO’s increasingly sophisticated tracking method means that there will be many employers who are at risk of an unforeseen tax bill.

Work on your policy for work-related vehicles and make sure you monitor how it is enforced.

We’re here to help if you have any questions.

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