Commercial vehicles are generally exempt from FBT and log book requirements. Many believe though that this means you can just claim 100% of the GST on the purchase price as well as 100% of GST on the related vehicle expenses. Not so. Commercial vehicles will be an exempt benefit for FBT purposes when the only private use, apart from minor, infrequent and irregular use by an employee, or an associate of an employee is travel to and from work or travel by an employee that is incidental in the course of performing employment duties. Unconfirmed reports of what the ATO is doing to police commercial vehicles:
- Apparently ATO officers attended the MCG on grand final day and checked the car park for ‘commercial’ vehicles parked there. These records would then be checked to registration records and then to relevant tax/FBT records to see if the correct treatment of the vehicle is being carried out.
‘A shiny red Dual Cab Ute that never looked like it did a day’s work in its life, registered to a company for example would lead to questions being asked’.
- Toll records are also being checked. Tolls attached to commercial vehicles that might occur on the weekend (particularly Sunday) could also lead to further investigations.
This article appeared in our November 2016 newsletter.