This sad face here is my concerned face when I read posts on social media where non-qualified people from all walks of life provide accounting and taxation advice in the form of answering call outs for help.
Earlier in the week I wrote that “I cannot stress the importance of taking advice from a professional rather than friends at the pub or via social media – there are far too many variables to consider and your investment in a consultation with The Tax Chic may just save you lots of $$ in the future.”
Let me share with you where this concern comes from…
I saw a social media post recently into a business group where the original author asked a question along the lines of “Do I really need an accountant to prepare my business tax return? I barely made enough money to cover my car repayments which I know are deductible so it doesn’t seem like it would be worth it”
Many people chimed in with their thoughts, some applying the law correctly and others not. But in this case, how is the original author to know who was right and who was wrong?
If you are well versed in tax law then I have no problem with you completing your tax return yourself, that is totally your call. But if tax is not your forte, I implore you to seek professional advice and please include a budget for accounting fees in your business calculations.
In short – car repayments are NOT deductible. If your car is leased then the work related portion of those payments may be deductible, otherwise, only the interest portion of car loan repayments, along with depreciation and other vehicle expenses may be claimed to the extent of your business use according to your log book (the other option for claiming motor vehicle expenses is the cents per kilometre method).
I want nothing more than for the whole world to know everything about how their business and financial affairs work – but until then, it is Accountants and advisors such as myself who are here to help – please let us help you!