01 Oct 2025

Car claims for electric vehicles

Car claims for electric vehicles

Working out the cost of electricity used to run your electric vehicle (EV) where you use the vehicle for business purposes and you use the logbook method for making your claim for car expenses is a little more complex than monitoring the cost of fuel used to run an all-petrol vehicle. You need to keep certain records and make some choices along the way.

But first, a quick look at some of the basic rules around tax claims for the business use of cars, including EVs.

What trips are eligible?

Costs incurred in running your car for business purposes can be deducted using one of several methods. The term “business purposes” includes:

» Attending meetings or conferences away from your usual place of work
» Collecting supplies or delivering items
» Travel between two separate places of work (e.g., for a second job)
» Travel from your home or your usual place of work to an alternative worksite (e.g., a client’s office or worksite)
» Itinerant work, where the job requires you to work at more than one location each day before going home

Note: Travel between your home and your usual place of work is only deductible in quite limited circumstances – e.g., when transporting bulky equipment to and from a worksite.

Cents per kilometre up to 5,000 km per year

For many taxpayers, the statutory safe harbour rate of 88 cents per kilometre for the 2025–26 income year (for up to 5,000 business kilometres) can be the simplest way of claiming car expenses.

• This gets you a deduction of up to $4,400 without having to keep any receipts.
• The cents per kilometre method covers all car expenses (depreciation, registration, insurance, repairs, maintenance, and fuel/electricity).
• It applies to EVs (including plug-in hybrids – PHEVs) as well as petrol-only cars.

If you use this method, you’ll need records showing how you worked out your business kilometres, e.g., a travel diary covering the income year. You must also show that you own or lease the car.

Logbook method

The logbook method can give a better result if you have a high percentage of business use.

Requirements:

• Keep receipts/evidence of all car expenses.
• Complete a logbook for a continuous 12-week representative period.
• Record:
  » Destination & purpose of each business trip
  » Total kilometres travelled
  » Opening & closing odometer readings

Other rules:

• The logbook percentage applies for 5 years, unless your usage pattern changes significantly (e.g., moving house, new job nature).
• For petrol cars: fuel/oil costs must be supported with receipts or reasonable estimates using odometer readings, manufacturer fuel data, and average petrol prices.

You then apply your business use percentage to the total costs (depreciation, insurance, rego, maintenance, etc.) for your deduction.

Electric vehicles (EVs)

EVs are typically charged at both commercial charging stations and home chargers.

• Commercial charging: Keep receipts (straightforward).
• Home charging: Usage is bundled with household electricity and usually can’t be separated.

Unless your EV can report the percentage of home charging, the ATO allows a home charging rate of 4.2c per km for the total distance travelled during the year.

Rules:

• The 4.2c/km rate covers all electricity costs → you cannot also claim commercial charging station costs.
• If you can separate home vs commercial charging:
  » Multiply home charging kms × 4.2c
  » Add actual commercial charging receipts

Keep:

• Commercial charging receipts
• An electricity bill
• Odometer readings (opening & closing)

Finally, add electricity costs to other running costs (incl. depreciation) and apply your logbook % for the claim.

Plug-in Hybrids (PHEVs)

PHEVs are trickier because they use both petrol and electricity.

The ATO has a detailed 7-step method to calculate this, but in practice, for tax prep you’ll need:
» Actual petrol and oil costs
» Opening & closing odometer readings
» Your PHEV’s Condition B test cycle fuel economy figure (manufacturer spec)

From there, we calculate the correct deduction to ensure you claim your full entitlement.