GST issues registers
Motor vehicle industry partnershipIssue 8 - Luxury cars
8.a. What vehicles are subject to luxury car tax?
Non-interpretative - straight application of the law.
Cars with a GST-inclusive value (the luxury car tax value) above the luxury car tax threshold ($65,094 for the 2017-18 financial year) are subject to luxury car tax.
Fuel efficient cars - luxury car tax applies to fuel efficient cars over the fuel efficient car limit, which is $75,526 for the 2017-18 financial year. A fuel efficient car is a car that has a fuel consumption not exceeding 7 litres per 100 kilometres.
(See question 'What vehicles are not subject to luxury car tax?').
8.b. What is a car for luxury car tax purposes?
Non-interpretative - straight application of the law.
The term 'car' for luxury car tax purposes includes vehicles (other than motor cycles) designed to carry a load of less than two tonnes and fewer than nine passengers including station wagons and four-wheel-drive vehicles. It also includes limousines regardless of their passenger carrying capacity.
8.c. What vehicles are not subject to luxury car tax?
Non-interpretative - straight application of the law.
Luxury car tax does not apply to a vehicle above the luxury car tax threshold if:
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- It was sold by retail in Australia before 1 July 2000.
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- It was imported into Australia before 1 July 2000 and nobody was entitled to quote for sales tax purposes.
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- There was an application to own use (AOU) of the vehicle before 1 July 2000 for sales tax purposes, and a special credit under section 16 of the A New Tax System (Goods and Services Tax Transition) Act 1999 (GST Transition Act) does not apply.
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- The date of the supply of the car is more than 2 years after the date of the car's local manufacture or date of entry for home consumption.
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- It is a prescribed emergency vehicle.
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- It is not GST-free and is specially fitted out for transporting people with a disability seated in wheelchairs.
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- It is a motor home or campervan.
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- It is a commercial vehicle that is not designed for the principal purpose of carrying passengers.
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- It is a fuel efficient vehicle which has a price less than the fuel efficient car limit of $75,526.
Luxury car tax does not apply to the private sale of a luxury car.
8.d. How does luxury car tax apply to the fitting of parts, attachments and accessories to luxury cars?
Non-interpretative - straight application of the law.
The luxury car tax value of a car includes the price of all supplies in relation to the car that are made to, or are paid for by, the recipient of the car, or an associate of the recipient and that are made before or arranged with the supplier or their associate before the vehicle is delivered.
8.e. For luxury car tax purposes, what is the date of importation for a car?
| The content for this issue is a public ruling for the purposes of the Taxation Administration Act 1953 and can be found here. |
8.f. When is luxury car tax payable?
Non-interpretative - straight application of the law.
Luxury car tax is payable on all taxable supplies or taxable importations of luxury cars unless the recipient of the car provides a quote, in the prescribed form, to the supplier or to Customs. The quotation system is designed to prevent luxury car tax becoming payable before the car is sold or imported at the retail level.
8.g. Who is entitled to quote?
Non-interpretative - straight application of the law.
Registered entities will be entitled to quote their ABN in relation to the supply or importation of a luxury car where they have the intention of using the car for one of the following purposes, and for no other purpose:
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- holding the car as trading stock, other than holding the car for hire or lease
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- carrying out research and development for the manufacturer of the car, or
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- exporting the car in circumstances where the export is GST-free.
8.h. Is there an input tax credit for luxury car tax?
Non-interpretative - straight application of the law.
No. Unlike the GST, no input tax credit is available for luxury car tax (LCT), regardless of whether the luxury car is used within a business or for private purposes.
For more information on luxury car tax, refer to the guide Luxury car tax.
8.i. Luxury motor vehicles for primary producers and tourism operators
Non-interpretative - straight application of the law.
Primary producers can claim a refund of luxury car tax from the ATO of up to $3,000 on an eligible car. Conditions apply.
Tourism operators can claim a refund of luxury car tax from the ATO of up to $3,000 on eligible cars. Conditions apply.
8.j. Fuel efficient motor vehicles
Non-interpretative - straight application of the law.
Luxury car tax does not apply to fuel efficient cars, imported or delivered after 3 October 2008, that are under $75,526 which is the fuel efficient car limit.
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© Australian Taxation Office for the Commonwealth of Australia
You are free to copy, adapt, modify, transmit and distribute material on this website as you wish (but not in any way that suggests the ATO or the Commonwealth endorses you or any of your services or products).
