Tax Limits for Cars - FY25

FOR 2024-2025 FINANCIAL YEAR

Luxury Car Tax & Car Cost Depreciation Limits are determined by the Australian Taxation Office and reviewed annually.

• Maximum value for calculating depreciation is $69,674
• Calculated on the business use of a car first used, or leased, in the 2023–24 income year.

GST for 2024-25

• Maximum GST to claim as Input Tax Credit (ITC) for 2024-25 is $6,334               (one eleventh of the car limit)
• No GST credit can be claimed for any Luxury Car Tax (LCT) when purchasing a luxury car, regardless of how much you use the car in carrying on your business.

LUXURY CAR TAX (LCT) for 2024-25

• For 'Standard' luxury cars: Maximum value for calculating depreciation is $80,567
• For 'Fuel efficient' luxury cars: Maximum value for calculating depreciation $91,387
• The LCT value of a car generally includes the value of any parts, accessories or attachments supplied or imported at the same time as the car.
• Cars with a luxury car tax (LCT) value over the LCT threshold attract an LCT rate of 33%.

For further information on tax rates and thresholds, visit the following ATO links:

• ATO - Cars and Tax 
• When Luxury Car Tax Applies
• Definition of "Fuel Efficient" Car
• Claiming GST Credit for Purchase of a Motor Vehicle

Need more information? Contact us and we'll be happy to answer any questions or provide further details.

We can help you determine a preferred finance structure that meets ATO guidelines and explain how it works and relates to your circumstances.

Call us today on (03) 9005-6633 and experience the difference!