What is the cents per kilometre rate for 2024–25 in Australia?

The ATO cents per kilometre rate for the 2024–25 income year is 88 cents per kilometre. This covers all car running costs including fuel, insurance, registration, servicing and depreciation. You can claim up to 5,000 km per car per income year under this method.

Can I claim my daily commute to work?

No — the cost of travelling from home to your regular place of work is not deductible. However, if you carry bulky tools or equipment that must be transported because there is no secure storage at work, your commute may be partially deductible. Travel between two workplaces, or from home to a client site, is deductible.

Do I need receipts for the cents per kilometre method?

No receipts are required for the cents per km method. However, you must be able to show how you calculated your work km — a diary, calendar entries, logbook, or odometer readings are all acceptable. The ATO may ask you to substantiate your claim.

How long does a logbook need to be kept for?

A logbook must cover at least 12 continuous weeks and be kept for a complete income year. Once complete, it is valid for 5 income years — you don't need to keep a new logbook each year unless your work travel pattern changes significantly.

Which method should I use — cents per km or logbook?

Use the cents per km method if you drive fewer than 5,000 km for work, or your actual running costs are low relative to your total km. Use the logbook method if you drive more than 5,000 km for work (as there is no cap), or if your running costs are high and your business-use percentage is significant. This calculator compares both for your situation.

Car Expense Tax Deduction Calculator Australia

Compare the ATO cents per kilometre method (88c/km, max 5,000 km) vs logbook method to maximise your work-related car expense deduction. 2024–25 ATO rates.

Method 1: Cents per Kilometre

No receipts required. The ATO accepts a reasonable estimate of your work km. Maximum 5,000 km per car per year.

Work-related kilometres driven

Method 2: Logbook (optional — for comparison)

Requires a logbook kept for at least 12 continuous weeks. Enter your total km, business km and annual running costs.

Total km driven (all purposes)

Business km driven

Business use: 33.3%

Annual Running Costs

Fuel & oil

Registration & CTP

Insurance

Servicing & tyres

Depreciation

ATO effective life: 8 yrs (12.5%/yr)

Loan interest

If you have a car loan

Work parking (not home or CBD daily)

Your Tax Rate

Marginal tax rate (incl. 2% Medicare levy)

Select the bracket that matches your total income

Logbook Method is Better for You

Max deduction

$3,400

Tax saving

$1,173

km claimed

3,500 km

Saving per week

$23/wk

Method Comparison

Cents per km — 88c/km

Business km (capped at 5,000)3,500 km

Deduction (3,500 × $0.88)$3,080

Tax saving at 34.5%$1,063

Logbook — 33.3% business use

Fuel & oil$3,600

Registration$800

Insurance$1,200

Servicing$600

Depreciation$4,000

Total annual expenses$10,200

Deduction (33.3% of $10,200)$3,400

Tax saving at 34.5%$1,173

The logbook method gives $320 more in deductions and saves you an extra $110 in tax.

How to Use This Calculator

1Enter the kilometres you drove for work purposes under the cents per km method
2Optionally enter your total annual km and business km to calculate logbook business-use percentage
3Enter your annual car running costs to see the logbook method deduction
4Select your marginal tax rate
5The calculator shows which method gives you the larger deduction and tax saving

What Are Work-Related Car Expenses?

If you use your car for work, you can claim a deduction for the work-related portion of your car running costs. Work-related travel includes: driving between two workplaces, travel to client visits, driving to buy work supplies, and travel for other work duties — but it excludes your ordinary commute from home to work.

The ATO offers two methods for calculating your deduction. The cents per kilometre method is simple and requires no receipts. The logbook method can produce a larger deduction if you drive extensively for work and have high running costs.

Key Things to Know

Cents per kilometre (88c/km): The simplest method. Claim 88 cents for every work kilometre driven, up to 5,000 km per car. All running costs are covered — fuel, servicing, insurance, depreciation. You need a reasonable basis for your km estimate (a diary, calendar notes or odometer records).
Logbook method: Keep a logbook for at least 12 continuous weeks showing the purpose and km of every trip. Calculate your business-use percentage and apply it to all actual running costs. Valid for 5 years if your usage pattern doesn't change significantly.
5,000 km cap: The cents per km method is capped at 5,000 km per car per income year. If you drive more than this for work, the logbook method is usually better as there is no km limit.
What counts as work travel: Driving between two workplaces, to client sites, to buy supplies, or for other work duties. Your regular commute from home to your main workplace is not deductible — unless you carry bulky tools or equipment that cannot be stored at work.
Car depreciation cap: Under the logbook method, car depreciation is limited to a cost cap ($69,674 for 2024–25). If your car cost more, you calculate depreciation on the capped amount. The ATO effective life for most cars is 8 years (12.5% per year).

Tips to Maximise Your Car Deduction

•Keep a record of your work trips throughout the year — a simple note in your phone calendar is enough for the cents per km method
•If you drive more than 5,000 km for work, always compare the logbook method — it could save you significantly more
•Start a logbook immediately if you've recently changed jobs or started driving more for work
•Include all running costs in your logbook calculation: depreciation is often the largest and most overlooked
•You can't claim a deduction for the cost of driving between home and your regular place of work
•If you use your car for ride-sharing (Uber/DiDi), you must declare the income and can claim expenses using either method

Frequently Asked Questions

Official Sources

Estimates only. Not financial or tax advice. Full disclaimer for your rights and our limitations of liability.

Rates and thresholds last updated for the 2024–25 financial year.

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