Cents per Kilometre

What are “Cents per Kilometre”?

“Cents per Kilometre” refers to a deductible expense allowance that defines a set rate for each kilometre travelled for business purposes. It covers the running costs of the vehicle, including registration, fuel, servicing, insurance, and depreciation.

However, it is important to note that this allowance should not include any payments made for travel between the payee’s home and place of work, unless it is a home-based business and the trip was for business purposes.

If the mileage is paid for private purposes, it is considered a non-deductible expense for PAYGW (Pay As You Go Withholding) and super guarantee purposes. These expenses should be reported as “ND Non-deductible” under the “Other Allowances” category.

On the other hand, if the mileage is paid for other vehicles, it is considered a deductible expense. However, no specific measures are defined by the ATO (Australian Taxation Office) for PAYGW and super guarantee purposes for these expenses. They should be reported as “V1 Private Vehicle” under the “Other Allowances” category.

Note: Services Australia categorises this allowance as an Expense Allowance.

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