.pdiX du.au/bbcswebdav/pid-2103285-dt-content-rid-3858787 1/courses/S-LAw505 201

Question

.pdiX du.au/bbcswebdav/pid-2103285-dt-content-rid-3858787 1/courses/S-LAw505 201830 SM /S-LAW505 201830 SM. I ImportedContent 2018022602 QUESTION 9.22 (Car expenses, change of ca Nathan conducts business as a financlal planner. During the 2010/11 tax year, he compiled a valid logbook indicating that he used his car 60% for business purposes. The car was a 2,400cc Subaru that he had bought In August 2009 at a cost of $34,600. On 1 November 2014, Nathan traded in his Subaru and purchased a Saab for $52,380. His new car had an engine capacity of 2,800cc. Nathan has not changed his address, office location or travel patterns during the 8 years that he has conducted business. His records show that he has consistently completed approximately 12,000 business kilometres during each year Nathan's running costs for the year (including decline in value) amounted to: $5,230 11,720 Subaru e Saab All expenses can be fully substantiated. Calculate the deduction available to Nathan for car expenses usi each of the methods available to him under Division 28. Activate W Go to Setting

Explanation / Answer

Deduction available for car expenses using each of the method available under division 28 1. Cent per kilometre Subaru 5000 Km x 0.76 cents $3,800 Saab 5000 Km x 0.77 cents $3,850 2. 12% of original value Subaru $34,600 x 12% $4,152 $4152 x 10/12 $3,460.00 As the new car was purchased in Nov, 2014, Nathan did not travelled more than 5000 Km by Saab, thus this deduction is not allowed on that car. Deduction on Subaru is available only for 10 months 3. One third of actual expenses Subaru $5230 x 1/3 $1,743 As the new car was purchased in Nov, 2014, Nathan did not travelled more than 5000 Km by Saab, thus this deduction is not allowed on that car. 4. Logbook method Subaru $5230 x 60% $3,138 Saab $11720 x 60% $7,032

Related Questions

Navigate

• Browse (All)
• Browse #
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.