Home – New Forums Money matters 12% CAR ExPENSES Reply To: 12% CAR ExPENSES

#1020849
linkman
Member
  • Total posts: 18
Up
0
::

Hi Karen.

You should be recording your expenses in a section of PL statement. I usually set up a MV section and then some other accounts that catch the obvious: Fuel, Repairs, Rego and Insurance, depreciation.

There is no need to allocate any 12% purchase price against your MYOB file. At year end your accountant will work out the best method of claiming your deductions. If the 12% is used then there will simply be a difference between your actual costs and the deduction claimed in your tax return. These are not normally processed through MYOB – except f you are keeping your accounts and the tax entries completely the same.

Effectively the difference would be between the MV cash expenses and the provision for Income tax account or the directors loan account.

Long winded answer I know, but basically, in a small business there should only be a need to process the expenses paid in cash. Any tax adjustments will be made at the end of the year and your accountant should be giving you a journal to post which adjusts those differences.