Home – New Forums Money matters Sole Trader Tax Deductions for Fuel.

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  • #977996
    bluepenguin
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    Hey all,

    I usually use a simple log book to work out what to claim on fuel each year, but I was wondering if it would be possible as a sole trader, for my business to provide me with a fuel card (motorpass.com.au) as part of my income – which would allow me to claim all the fuel I use as a business expense.

    I was thinking about it more for the convenience than the tax deductions. I like to do everything by the book but just wanted to see if anyone has the answer.

    Thanks,

    #1104004
    Past-Member
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    You can still claim part of your fuel as business. For example, say you spent $50 on fuel. Your claim is 60% business from your car log. So you would claim 60% of the $50.

    I have my MYOB (or whatever you use) set up like this:

    Fuel (petrol station name) $50 (fuel expense)
    Fuel (petrol station name) $55 (fuel expense)
    Deduct personal 40% of $105 (minus) – $42 (fuel expense)
    Personal drawings $42 (Drawings)

    Total $105

    Some people don’t claim till the end of the year. I find it easier to do it as I go along so I don’t owe more than I need.

    Cheers.

    #1104005
    bluepenguin
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    Thanks Karen,

    I currently do it that way – well my bookkeeper does.

    I don’t know if I worded it correctly – but was I’m trying to work out is, if I get a Motorpass account, can the whole account be seen as a business expense, rather than just what’s used for business.

    Think of how a bank manager might get a company car and a fuel card. Regardless of whether he drives to see a customer, or take the family fgor an interstate holiday, the car and fuel are part of his salary and so the whole amount would be tax deductable for the employer.

    Could that system work for a sole trader?

    #1104006
    MyGreatIdea
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    From what I have been told, you wouldn’t be able to claim all of the fuel booked up onto the card if your logbook indicates you only use your car for a portion for business use.

    Example, your logbook shows that 80% of your kms are for business use. Then only 80% of your fuel can be claimed for business.

    I kept a logbook for 12 weeks to determine my business use percentage. I then use this percentage across all m/v expenses – services, rego, insurance, tyres and fuel.

    So I guess having a fuel card would make it easier to calculate your business portion of fuel, simply because you have a monthly statement.

    Wendy :)

    #1104007
    Chris Brodie
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    Hi bluepenguin,
    You can use a motorpass card to pay for you fuel and use it as a record keeping device, but using a motorpass card does not mean that you can claim 100%. What you can claim is determined by the vehicle log book you have (should have) kept which shows the percentage of business use as against private / personal use. Also running a motorpass card will cost money (they do charge fees), but it itself does not allow any extra deductions.
    Hope this helps,
    Chris.

    #1104008
    bluepenguin
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    Thanks all for your very helpful responses.

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