Tax breaks explained: 10% and 50% what's the difference?

If your business has an annual turnover of less than $2million, you may be able to claim an additional 50% tax deducion on your purchase.
Purchases elible applies only to new and eligible demonstrator vehicles below the current luxury tax threshold of $57,123 and must be made by December 31, 2009, and delivered/ picked up by December 31, 2009.

An example would be if a car is purchased for $40,000. By the end of the 2009/10 financial year, if a normal standard depreciation is 25% for the first year and additional 50% is claimable under the new legislation. This equals to $10,000 for the stardard claim plus a further $20,000. This results in a total tax deduction of $30,000 in the first year.

From the second year onwards the standard normal deduction rate applies.



For businesses with an annual turnover of more than $2million, and additional 10% tax deduction on vehicle purchases applies. Vehicles must be ordered by December 31, 2009 and delivered/ Picked up by December 31, 2009.

A purchase made and picked up within the specified period may entitle the business owner an additional 10% deduction on top of the standard depreciation rate.


Please speak to your accountant or financial advisor prior to making any purchase decision

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