Assets and exclusions
The maximum value for calculating depreciation on the business use of a car first used or leased in the 2023–24 income year has increased to $68,108.
There is a limit on the cost to work out the depreciation of passenger vehicles (except motorcycles or similar vehicles) designed to carry a load of less than one tonne and fewer than nine passengers.
The maximum value for calculating a claim is the car limit, irrespective of any amount paid for a trade-in in the year in which the car was first used or leased.
| Income year | Car limit | ATO reference |
|---|---|---|
| 2023–24 | $68,108 | The indexation factor is 1.052, calculated as 435.5 divided by 413.8 |
| 2022–23 | $64,741 | The indexation factor is 1.066, calculated as 413.8 divided by 388.1 |
| 2021–22 | $60,733 | The indexation factor is 1.027, calculated as 388.1 divided by 377.9 |
| 2020–21 | $59,136 | The indexation factor is 1.027, calculated as 377.9 divided by 368.1 |
| 2019–20 | $57,581 | No indexation – the indexation factor is 0.987 calculated as 368.1 divided by 373.0 |
How the yearly car limit is calculated
The car limit is indexed annually in line with movements in the motor vehicle purchase sub-group of the consumer price index.
The indexation factor is calculated by dividing the sum of the index numbers for the quarters in the year ending 31 March by the same numbers for the quarters in the year ending on the previous 31 March.
The car limit amount is then indexed by multiplying it by the indexation factor unless the indexation factor is one or less.