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.
How to make payroll efficient with Workstem?
Simplify your payroll processes with Workstem’s all-in-one platform, handling onboarding, time and attendance, award interpretation, payroll, STP 2, superannuation and more.
Customise attendance entitlements, auto-track attendance data, streamline the payment process and keep compliance with Fair Work award through our AI Engine. Workstem provides a complete solution for efficient payroll management and regulatory compliance.