Claims for lease charges for luxury cars are not allowed under this method. The vehicle is to be treated as if purchased on hire purchase at a GST inclusive price limited to the relevant luxury car limit.
For each full year:
> This method allows you to claim one-third of each car expense including operating expenses, leasing expenses or depreciation. Car expenses do not include capital costs, such as the initial cost of your car or improvements to your car.
> Your car must have (or would have if you had it for the whole financial year) travelled more than 5,000 business kilometres during the financial year.
> You need written evidence for all car expenses except for fuel and oil costs.
> There are two ways to work out fuel and oil costs. Use your fuel and oil receipts if you have them or keep odometer records and make a reasonable estimate based on those records.
Odometer records need to show the odometer reading of the car at the start and end of the period that you owned or leased the car. They should also show the car's engine capacity, make, model and registration number.
You may also need to show how you worked out your business kilometres and any reasonable estimate you made