Cents Per Km Calculator
Car expense deduction — AU 2026-27

The cents per kilometre rate is 91 cents for the 2026-27 income year, set by ATO legislative instrument LI 2026/19. That figure is a base rate of 89 cents plus a one-off 2 cent uplift that applies to 2026-27 only. The rate for 2025-26 — the year most people are lodging a return for between July and October 2026 — is 88 cents. Use the rate for the year you are claiming, not the current one: claiming 91c on a 2025-26 return overstates the deduction.

Under the cents per kilometre method you can claim up to 5,000 work-related kilometres per car per year with no logbook. At the 2026-27 rate of 91c that is a maximum deduction of $4,550; at the 2025-26 rate of 88c it is $4,400. The cap is per car, so if you genuinely used two cars for work you can claim up to 5,000 km on each. You still cannot simply invent the number — the ATO expects you to show how you calculated your work kilometres, using a diary of trips, a calendar of work appointments that required travel, or odometer readings.

Whichever produces the larger deduction, and it depends on two things: how far you drive for work and how expensive your car is to run. Cents per km is capped at 5,000 km, so above roughly 5,000 work kilometres the flat method stops growing while the logbook method keeps going. The logbook claim is your total annual running costs — fuel, registration, insurance, servicing, tyres, interest and depreciation — multiplied by your work-use percentage. As a rough guide, if your work driving is well under 5,000 km or your car is cheap to run, cents per km usually wins on both dollars and effort; if you drive a lot for work or run an expensive vehicle, the logbook usually wins by a wide margin. This calculator compares both at your numbers.

Everything. The rate is designed to cover all running costs of the car — fuel, servicing, tyres, registration, insurance and decline in value (depreciation). That means you cannot claim any of those separately on top of a cents per kilometre claim. This is the single most common error: claiming 91c per kilometre AND a fuel or depreciation deduction for the same car double-counts, and it is the sort of thing ATO data-matching picks up. Tolls and parking for work trips are a separate category and can still be claimed on their own.

Travel between two separate workplaces, travel to meet clients or make deliveries, carrying bulky work equipment you cannot leave at work, and travel from a regular workplace to an alternative one. What does NOT count is ordinary home-to-work commuting, even if you live a long way from work, work outside normal hours, or make an incidental work stop on the way. For rideshare and delivery drivers the practical distinction is that kilometres driven while logged on and available for jobs are generally work-related, while the drive from home to your starting area is generally not.

Yes, and for many drivers it is the simpler choice — but the 5,000 km cap bites quickly. A driver doing even 15 hours a week will usually pass 5,000 work kilometres well before the end of the year, at which point the flat method caps out at $4,550 (2026-27) while a logbook claim would keep growing with every kilometre. If you drive for rideshare or delivery regularly, keeping a 12-week logbook once is almost always worth the effort: it is valid for five years and typically produces a substantially larger deduction. Note that GST and the car expense rules interact for rideshare — rideshare drivers must be GST-registered from the first dollar.

Record every trip for a continuous 12-week period that is representative of your usual driving: the date, start and finish odometer readings, kilometres travelled, and the reason for the trip. You also need the odometer reading at the start and end of the income year, and you need to keep receipts for your running costs. That logbook stays valid for five years, provided your work-use pattern does not change materially, so the effort is a one-off rather than annual. If your circumstances change — a new job, a new car, a different work pattern — start a new one.

A car expense is a deduction, not a rebate, so its cash value is the claim multiplied by your marginal tax rate plus the 2% Medicare levy. A full $4,550 cents-per-km claim at the 2026-27 rate is worth about $773 to someone in the 15% bracket, $1,456 in the 30% bracket, and $2,139 at the top 45% rate. That is why the same claim is worth roughly three times as much to a high earner as to a low earner, and why a bigger deduction matters more the higher your income.