ATO Cents Per KM Reimbursement Rate For 2021/2022

The ATO mileage rates are important for your mileage reimbursement calculations. This year, the ATO has kept the mileage rate the same as the previous year. 

Are you looking for ATO's revised cents per kilometre rate for 2022/2023? See our article on the ATO cents per km rate for 2022/2023.

For work-related mileage incurred from July 1, 2021, the ATO cents per kilometre rate for cars (not including motorcycles or vehicles with a carrying capacity of one tonne or more, or nine or more passengers, such as a utility truck or panel van) is: 

• $0.72 per kilometre driven for business

Learn more about the historic ATO cents per km rates.

 The current ATO mileage rate 2021

Starting from the 2021 financial year, the mileage rate for cars (motorcycles or vehicles with a carrying capacity of one tonne or more, or nine or more passengers, such as a utility truck or panel van) using the cents per km method is $0.72 per km driven for business.

You can use this rate with the cents per km method for your mileage claim as a sole trader, or if your employer reimburses you at the ATO mileage rate.

As an employee, your employer can choose to reimburse you for the costs you incur when you use your vehicle for business. It's up to your employer to set the rate and the rules for reimbursement, but the ATO mileage rate is the standard. If you're paid more per kilometre than the ATO mileage rate in 2021, or if you’re paid a car allowance rather than being directly reimbursed for your specific expenses, those payments are considered taxable income.

If you're self-employed, you have the option of using the ATO's rate to deduct the costs of using your car for business.

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Alternatives to the cents per km reimbursement rate 2021

As a self-employed entrepreneur or a business owner, you have the option of calculating the costs of operating your vehicle for business using either a logbook or, if your business is a company or trust, the actual costs method. Instead of using the ATO mileage rate for 2021, you can therefore use the actual costs method instead.

If you're an employee, since the standard cents per km rates are optional, your employer can choose to use that rate or an alternative. Check the rates and rules with your employer before calculating reimbursements when using the cents per km method. Here’s our guide to mileage reimbursement for employees.

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