Do you wish to purchase a Maserati and claim the expenses as an allowable deduction?
Recently, an optimistic taxpayer set out to make a claim for his expenses incurred as owner of a cool Maserati. How might this play out in the world of taxation?
It is common ground that there must be a nexus between expenditure, and the gaining or producing of assessable income. It is also common ground that travel between home and work does not have the requisite connection with assessable income.
The good news is that you the taxpayer can claim a deduction for the cost of travel between two places of work, provided that in both locations you the taxpayer engage in activities to gain or produce assessable income.
But, you must also obey the rules for recording of work related motor vehicle expenses. These include keeping a logbook, claiming on a per kilometre basis, estimating business use percentage. Remember that the taxpayer must be able to substantiate car expense claims.
What happened to the Maserati owner? He missed out, as he misled the Tribunal as to the garaging of the car, was found to have constructed his logbook in hindsight, and tried to claim to and from work as a deduction.
So, it doesn’t matter whether you drive a Maserati, or one of the last Holdens to be made in Australia. Following the rules is the key!