Under Tax Determination 2016/8, the car limit is $57,581 for the 2016/17 (up from $57,466 for the previous year). This amount limits depreciation and GST input tax credit claims.
As the indexation factor was less than 1, the car limit for the current year has not been indexed and remains the same as last year.
In July 2016, Laura buys a car to which the car limit applies for $60,000 to use in carrying on her business. As Laura started to hold the car in the 2016/17 financial year, in working out the car’s depreciation for the 2016/17 income year, the cost of the car is reduced to $57,581.
Should you have any queries in regards to the above article, please do not hesitate to contact our office on
02 4958 1829 or email our Client Support Manager on firstname.lastname@example.org.