The ATO has updated information about use of the cents per km basis for claiming care expenses and for fringe benefits calculations.

From 1 July 2015, separate rates based on the size of the engine are no longer available. Taxpayers can use a single rate of 66 cents per kilometre for all motor vehicles for the 2015-16 income year. The Commissioner will determine the rate for future income years.

However, the ATO acknowledges there has been uncertainty about the correct rate to apply for the 2016 FBT year. Therefore, the ATO has advised of a special arrangement for 2016 whereby it will also accept 2016 FBT returns based on the 2014-15 rates (which are 64, 76 or 77 cents per kilometre depending on the engine capacity of the employee’s car).

For future FBT years, which end on 31 March, the ATO says employers should use the rate determined by the Commissioner for the income year that ends on the following 30 June. For example, for the FBT year ending 31 March 2017, employers should use the basic car rate determined by the Commissioner for the 2016-17 income year.

[ATO website] [LTN 59, 30/3/16]