Commonwealth Numbered Regulations - Explanatory Statements

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Statutory Rules 1991 No. 121


These regulations amend the Income Tax Regulations by inserting a new Part V at the end of Schedule 6.

Section 82KX of the Income Tax Assessment Act 1936 (the Act) enables a taxpayer to elect an arbitrary basis of deduction in relation to a car that is owned or leased by the taxpayer and used for the purpose of producing assessable income, where the number of kilometres travelled for that purpose is not more than 5,000 in a year of income.

The deduction allowable under section 82KX is equal to the number of business kilometres multiplied by the prescribed rate of cents per kilometre applicable to the car's engine type and size, expressed in cubic centimetres.

The purpose of these regulations is to prescribe the relevant rates for the purposes of section 82KX of the Act that are to apply for the year of income commencing 1 July 1990.

The regulations are also used to calculate the taxable value of a number of fringe benefits (such as remote area holiday travel) provided in the fringe benefits tax year ended 31 March 1991.

The prescribed rates are based on the private motor vehicle allowance rates payable to members of the Australian Public Service.

The regulations do not affect the rights of any person (other than the Commonwealth) in a manner prejudicial to that person, nor do they impose any liability on such a person.

Accordingly, the relations amend Schedule 6 of the Income Tax Regulations by inserting new Part V after Part IV. The new Part V of the Schedule sets the car expense deduction rates for the year of income commencing on 1 July 1990 and ending on 30 June 1991.

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