When you share your caravan or recreational vehicle (RV) through a peer-to-peer sharing platform (such as SHAREaCamper, Camplify, MyCaravan, Hire My Caravan or Camptoo), there are certain things that you need to be aware of. You need to:
- declare all your income in your tax return
- only claim the expenses you are entitled to claim as income tax deductions
- keep records of your income and the expenses you can claim as deductions.
Note: RV includes campervan, motor home or camper trailer.
See also:
- Sharing assets (excluding accommodation)
- Income and deductions – for individuals
Claiming expenses
You can claim expenses for income tax purposes as long as:
- they are directly related to the sharing of your caravan or RV
- you keep records such as receipts to back up your claims.
You may be able to claim 100% of expenses you incur under the terms of the contract with the peer-to-peer platform, such as membership or listing fees and commission.
All other expenses you incur need to be apportioned to take into account private use, such as:
- storage fees
- lease or interest payments and depreciation
- insurance
- registration
- cleaning.
Apportioning the expenses for private use
If you share your caravan or RV and there is also private use during the year, your expenses need to be apportioned according to income-producing and private use. You cannot claim deductions for the portion of expenses relating to private use.
Private use includes use by you, your family, your relatives and your friends free of charge.
If your caravan or RV is rented or hired out to family, relatives or friends at below market rates, your deductions are limited up to the amount of the income you receive.
If you purchased or use the caravan or RV mainly for private use, you count the periods the caravan or RV is not rented or hired, even if it's available for rent or hire on the platform, as private use. You will only be entitled to claim a deduction for expenses in proportion to the time the caravan is actually being shared.
If you purchased or use your caravan or RV mainly for income-producing use, you're entitled to claim deductions for periods when the caravan or RV is rented or genuinely available for rent. For your caravan or RV to be genuinely available for rent, you must:
- advertise it widely so it will attract users and respond to enquiries in a reasonable period
- make it available during peak periods when people want to rent it
- ask for a fair rent comparable to other listings
- ensure it's in a location and condition that will make it likely to attract tenants
- not refuse to rent it to interested people without adequate reasons.
Even caravans and RVs that are mostly for income-producing or investment purposes are able to have periods of private use. If you use it yourself or rent it to family or friends at less than market rates, you will be required to apportion your expenses and only claim a deduction for the expenses up to the amount of income received.
Mary and John purchased an RV, which they use mainly for private use, and completed an initial long trip around Australia. They store the RV at their home and occasionally their grandson stays in it when he visits.
They are now finding they do not use it very often and their relatives are using it a lot. They have decided to rent it out for extra income when they are not using it for private use.
They use a digital platform to advertise it for rent during the year. They hire it out for 26 weeks of the year to paying renters. Mary and John use the RV for private use for six weeks during the year to go on holidays.
Mary and John’s income-producing use during the year is 50% (26 weeks hired out to paying renters) and private use is 50% (26 weeks).
They can claim 50% of expenses such as insurance and registration as they relate to some private use of the RV. They can claim 100% of expenses such as membership fees or commissions as they do not relate to the private use of the RV.
During the year, Mary and John’s platform membership fees are $500. Other expenses, such as registration, insurance, interest and cleaning, are $3,000. The income-producing proportion of these other expenses is $1,500 (50% of $3,000). The total allowable deductions are $2,000 ($1,500 + $500).
Mary and John receive $4,000 of income from renting out the RV during the year.
Mary and John’s income and deductions for the year are as follows:
- income received = $4,000
- deductions = $2,000.
Mary and John own an equal share in the caravan (50% each).
They will each need to include $2,000 at the other income label and $1,000 at the other deductions label on their individual tax returns.
It is important that Mary and John keep records of their income and expenses, such as statements from the digital platform, bank account and other invoices.
End of example
Byron lives in Dubbo and purchased three RVs mainly as an investment and for income-producing purposes. He uses a peer-to-peer digital platform to advertise them for rent during the year.
Byron has researched the market and found that North Sydney is a popular area for RV rentals. He stores the three RVs in North Sydney that are available for rent and he only uses one of the RVs privately for four weeks each year when it has no bookings.
Byron’s tax reporting obligations are the same as John and Mary's in Example 1. However, in determining his apportionment of expenses that he can claim as a tax deduction, he can count the period of time that each RV was genuinely available for rent.
For the two RVs rented or genuinely available for rent for the whole of the year, he can claim 100% of the expenses as a tax deduction.
For the one RV used privately for four weeks, he has to reduce his deductions to take into account the period of private use, that is, he can only claim 92% (48÷52) of the related expense.
End of example