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The rates set out below apply for the 2022-2023 income year for business motor vehicle expenditure claims. The Tier 1 rates reflect an overall increase in vehicle running costs largely due to fuel costs.

The table of rates for the 2022-2023 income year

The Tier 1 rate is a combination of your vehicle's fixed and running costs. Use it for the business portion of the first 14,000 kilometres travelled by the vehicle in a year. This includes private use travel.

The Tier 2 rate is for running costs only. Use it for the business portion of any travel over 14,000 kilometres in a year.

Vehicle type Tier 1 rate per km Tier 2 rate per km
Petrol or diesel 95 cents 34 cents
Petrol hybrid 95 cents 20 cents
Electric 95 cents 11 cents

Learn more about using kilometre rates

Claiming vehicle expenses

OS 19/04A: Commissioner's statement on using a kilometre rate for business running of a motor vehicle - deductions

OS 19/04B: Commissioner's statement on using a kilometre rate for employee reimbursement of a motor vehicle

Last updated: 15 May 2023
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