Subsidies and capital expenditures for certain road vehicles. If you buy a car with a value that includes GST above these LCT thresholds, you must pay LCT. In general, the value of a car includes the value of any part, accessory, or accessory that you have supplied, or imported, at the same time as the car. The maximum value you can use to calculate your claim is the car limit (regardless of how much you were paid for a trade-in) in the year you first used or leased the car.
If you buy a car and the price exceeds the LCT car limit, the maximum amount of GST credit you can claim is one-eleventh of that limit. In general, the value of a car includes the value of any part, accessory, or accessory supplied or imported at the same time as the car. If you buy a car with a price that exceeds the car limit, it only includes depreciation up to the limit. However, the Income Tax Assessment Act 1997 (ITAA9) places a limit on the amount of depreciation that can be claimed as a tax deduction and the New Tax System (Goods and Services Tax) Act 1999 (GST Act) also imposes a limit on the amount of GST that can be claimed with compared to a luxury car.
From the point of view of a typical car buyer, when the tax is paid, it will already be factored into the price quoted by a car dealership or depot. A “luxury car” is a motor vehicle designed to carry a load of less than two tons and less than nine passengers, with a price including GST that exceeds the luxury car tax threshold.
