Calculations have been carried out over five replacement cycles for a new vehicle, from one to five-years based on annual distances of 10,000 thru to 50,000 kilometres per annum.  All costs are based on retail prices including GST and comprise of the following elements.

Depreciation

Depreciation for business vehicles is calculated using average market rates for the model listed from research gathered by NRMA Motoring & Services and Glass’s Information Services (Glass’s Guide).

Opportunity Cost

This is the loss of return on the capital invested in the vehicle after allowing for its residual at the end of each replacement cycle.  The Australian Taxation Office deemed interest rate of 6.55% has been used as the default.  There has been no provision for the borrowing costs of the capital.

Vehicle Registration and Insurance

Calculated using New South Wales Roads and Traffic Authority (RTA) business rates. NRMA Insurance Comprehensive and Compulsory Third Party (CTP) business insurance rates have been used for a driver aged between 25 and 55, assuming a maximum No Claim bonus and including the GST Impact.

Motoring Club Membership

Calculated using NRMA Motoring & Services current rates.

Fuel

Fuel consumption has been calculated from results of tests carried out by manufacturers to Australian Design Rule ADR79/01 the results are shown on the ADR81/01 fuel consumption label, we have continued with the practice of adding an additional 15% factor to the reported results as was recommended by the Australian Greenhouse Office for AS2877 data. Where ADR79/01 data is not available, fuel consumption is taken from road tests carried out by NRMA Motoring & Services.

Vehicle Maintenance

Vehicle service costs are calculated using manufactures recommended service schedules and include a range of replacement parts considered appropriate for normal driving conditions and annual distances, with replacement parts including the GST.

Fringe Benefits Tax (FBT)

FBT has been calculated using both the statutory and operating costs methods used to calculate FBT, this can assist in determining the method best suited to the business for calculating FBT.
Where a commercial vehicle meets the criteria set out in ATO Ruling MT 2024 for exemption, no FBT will be calculated. Should the vehicles use not meet these criteria, then FBT can be shown.

Please note FBT is a guide only and should be discussed with a taxation specialist.