Luxury Car Depreciation Tax Limits 2018

Luxury Car Limit for Depreciation purposes

The luxury car tax limit for depreciation purposes under section 40-230 of the Income Tax Assessment Act 1997 for the FY 2017-18 is $57,581. This limit also applies for depreciation purposes to fuel efficient cars.


A Caulfield accountant purchases a hybrid Mercedes Benz at a value of $75,000 in July 2017. The car is depreciated at a reduced cost base initial value of $65,094.

Luxury car tax threshold

Luxury car tax is the 33% tax imposed on the GST inclusive purchase price of luxury cars over the luxury car tax threshold. The luxury car tax threshold for the 2017-18 year is $65,094 which was provided for in a luxury car tax determination LCTD 2017/1.

For fuel-efficient cars the threshold remains at $75,526.

Contact Hillyer Riches Tax Accounting Firm Caulfield or for more information email

This article is for general information only and should not be relied upon without first seeking advice from an appropriately qualified

Scroll to Top