Mileage Claims for Jointly Owned Motor Vehicles Explained

The ATO have confirmed that even when a vehicle is only registered in their spouses name a taxpayer is still considered to be the joint owner or lessee of the motor vehicle and eligible to claim expenses.

This means where a husband and wife jointly own a motor vehicle and they both separately use that vehicle for an income producing purpose (work or a business), then each taxpayer will be entitled to claim a deduction using the cents per kilometre method (up to 5,000 work or business kilometres). This is assuming they each actually did travel 5,000 work or business kilometres. A diary evidencing business or work related kms travelled is required to be kept.

Additional tax deductions are potentially available if a husband and wife jointly owned two motor vehicles. If both spouses used each vehicle to travel 5,000 work or business related kilometres then each spouse would be claiming a deduction for 10,000 kilometres. That is, claiming a total of 20,000 business kilometres between the two spouses (assuming they actually did travel 20,000 work or business kilometres). The ATO allows a deduction of $0.66 per kilometre travelled, so for 20,000 kilometres the total deduction would be $13,200.

Please Note: Many of the comments in this article are general in nature and anyone intending to apply the information to practical circumstances should seek professional advice to independently verify their interpretation and the information’s applicability to their particular circumstances.

Copyright © 2018 Robert Bauman.