how to claim depreciation on car

Ah, the thrilling world of depreciation claims—tax time's favourite pastime. To claim depreciation on your car in Australia, you generally need to use it for business purposes. The Australian Taxation Office (ATO) allows you to deduct the decline in value of your car as a business expense, calculated either by the diminishing value method or the prime cost method.

Key points:

• The car must be used for income-producing activities.
• You can claim depreciation over the effective life of the vehicle, usually set at 8 years by the ATO.
• Keep detailed records of business vs. private use to apportion deductions accurately.

For the exact calculations and to avoid a tax audit nightmare, consult the official ATO guidelines or a tax professional. Or just use ServiceCentral and pretend you know what you’re doing.