Cents per km calculator 2026-27 (ATO rate)

Cents per km rate by income year

The ATO cents per km method values each business kilometre at one rate set for the income year, which runs from 1 July to 30 June. For 2026-27 the Commissioner's determination F2026L00785 sets 91c: an 89c base, which is 88c indexed by the private motoring sub-group of the Consumer Price Index, plus a one-off 2c uplift for fuel price movements in the March 2026 quarter. This uplift applies to 2026-27 only, and the 2027-28 rate will index the 89c base. Kilometres count in the income year in which you drove them: trips from January to June 2026 use the 2025-26 rate of 88c. In 2026-27, 3,140 business km give 3,140 x $0.91 = $2,857.40, and 6,200 business km are capped at 5,000, giving 5,000 x $0.91 = $4,550.00.

Official sources

• Income Tax Assessment (Cents per Kilometre Deduction Rate for Car Expenses) Determination 2026 (F2026L00785) Federal Register of Legislation
• Explanatory statement to F2026L00785 (89c base and 2c one-off uplift) Federal Register of Legislation
• Cents per kilometre determination 2024 (F2024L00697): 88c for 2024-25 and 2025-26 Federal Register of Legislation
• Cents per kilometre determination F2023L00767 (85c for 2023-24) Federal Register of Legislation
• Cents per kilometre determination F2022L00813 (78c for 2022-23) Federal Register of Legislation
• Cents per kilometre determination F2020L00676 (72c for 2020-21 and 2021-22) Federal Register of Legislation
• Cents per kilometre determination F2018L01023 (68c for 2018-19 and 2019-20) Federal Register of Legislation
• Cents per kilometre determination F2016L01157 (66c for 2016-17 and 2017-18) Federal Register of Legislation
• Cents per kilometre method (individuals), updated 12 August 2026 Australian Taxation Office

Who can use the method: own car, company car, novated lease

The cents per km method is for a car you own or lease, hire purchase included, and use to earn your income. Sole traders, employees and partnerships with at least one individual partner can use it. A car provided by an employer, or held under a novated lease or a salary sacrifice arrangement, is not owned or leased by the employee: its private use falls under fringe benefits tax, and the employee cannot claim cents per km for it. Companies and trusts cannot use the method.

Conditions

• Sole traders, employees and partnerships with at least one individual partner: allowed for a car they own or lease.
• Companies and trusts: not allowed.
• Novated lease, salary sacrifice or employer-provided car: not allowed.
• Normal travel between home and work is private and does not count as business km, except in limited cases.
• Receipts are not required. Keep a record showing how you worked out your business km, such as a diary or trip records; the ATO accepts a reasonable estimate.

Official sources

• Cents per kilometre method (individuals), updated 12 August 2026 Australian Taxation Office
• Cents per kilometre method (businesses), updated 27 May 2026 Australian Taxation Office
• Expenses for a car you own or lease, updated 4 May 2026 Australian Taxation Office

5,000 km cap per car and per income year

The cap applies to each car separately and starts again on 1 July. Two eligible cars can each be claimed for up to 5,000 business km, and joint owners who use the same car for separate income-producing purposes can each claim up to 5,000 km. Business kilometres above the cap add nothing under this method. Every running cost and decline in value is included in the rate, so no other car expense is claimed on top.

Conditions

• The method is chosen per car for a whole income year and can change from one year to the next.
• Decline in value cannot be claimed separately under this method.

Official sources

• Cents per kilometre method (individuals), updated 12 August 2026 Australian Taxation Office
• Cents per kilometre method (businesses), updated 27 May 2026 Australian Taxation Office

Electric cars and the EV home charging rate

No separate cents per km rate exists for electric cars: a Tesla uses the same 91c in 2026-27. That rate already covers electricity, so home or Supercharger charging cannot be added to a cents per km claim. Under the logbook method, home charging can be valued with the EV home charging rate of Practical Compliance Guideline PCG 2024/2, then multiplied by your business-use percentage. Commercial charging receipts can be added to the home rate only when the car reports the share of charging done at home.

Conditions

• Zero emissions cars (battery electric or hydrogen fuel cell): from 1 July 2022 for income tax and 1 April 2022 for FBT.
• Plug-in hybrids: from 1 July 2024 for income tax and 1 April 2024 for FBT, through a separate method based on petrol kilometres.
• Chosen per vehicle for a whole income year or FBT year.
• Requires odometer records for the year, and a valid logbook for the logbook method.

Official sources

• PCG 2024/2 Electric vehicle home charging rate (Table 2 amended 25 March 2026) Australian Taxation Office
• Fringe benefits tax rates and thresholds, updated 20 May 2026 Australian Taxation Office

Above 5,000 km: the logbook method

Above 5,000 business km the cents per km claim stays capped. The logbook method is a separate choice, made per car for the income year. It needs a logbook kept for at least 12 continuous weeks that represents your use over the year, valid for 5 years unless your circumstances change, plus receipts for every expense. Your business-use percentage then applies to all actual car expenses: electricity, servicing, repairs, tyres, registration, insurance, loan interest, lease payments and decline in value. Decline in value uses a cost capped at the car limit of the year the car is first used or leased: $69,883 for 2026-27, and $69,674 for 2024-25 and 2025-26.

Conditions

• Logbook of at least 12 continuous weeks, representative of the whole year.
• Normal home-to-work trips count as private.
• Keep the logbook for 5 years after the end of the latest income year it supports.

Official sources

• Logbook method (individuals), updated 12 June 2026 Australian Taxation Office
• Logbook method (businesses), updated 19 June 2024 Australian Taxation Office
• Car thresholds from 1 July, published 9 June 2026 Australian Taxation Office

Cents per km allowance paid by an employer

An employer can pay a cents per km allowance for an employee's own car. The whole allowance is assessable income and appears on the employee's income statement, and the employee then claims a deduction with the cents per km or logbook method. No PAYG tax is withheld on the part paid at or below the ATO rate for up to 5,000 business km in the income year. Kilometres above 5,000, and any part of the rate above the ATO rate, are subject to withholding.

Official sources

• Withholding for allowances, updated 26 August 2026 Australian Taxation Office
• Expenses for a car you own or lease, updated 4 May 2026 Australian Taxation Office