The two methods in plain words
- Cents per km: work km × 91c (2026-27), up to 5,000 km. No receipts. Maximum $4,550.
- Logbook: keep a logbook for 12 continuous weeks to find your work-use percentage, then claim that percentage of all your car costs — fuel, rego, insurance, servicing, interest on a car loan and decline in value. No cap on kilometres.
Example: 15,000 km, 60% for work
A tradie drives a $45,000 petrol Mazda CX-5 15,000 km a year. The logbook shows 60% work use, so 9,000 work km.
- Cents per km: capped at 5,000 km × 91c = $4,550
- Logbook: fuel $2,281 + rego, insurance and servicing $3,500 + decline in value $11,250 = $17,031 × 60% = $10,219
The logbook gives $5,669 more. At a 30% tax rate plus the 2% Medicare levy that is roughly $1,800 extra in your refund — well worth 12 weeks of notes.
Where is the break-even?
Same car and costs, 15,000 km a year, different work shares:
| Work use | Work km | Cents per km | Logbook | Better by |
|---|---|---|---|---|
| 20% | 3,000 | $2,730 | $3,406 | Logbook +$676 |
| 30% | 4,500 | $4,095 | $5,109 | Logbook +$1,014 |
| 33% | 4,950 | $4,504 | $5,620 | Logbook +$1,116 |
| 40% | 6,000 | $4,550 | $6,812 | Logbook +$2,262 |
| 45% | 6,750 | $4,550 | $7,664 | Logbook +$3,114 |
| 60% | 9,000 | $4,550 | $10,219 | Logbook +$5,669 |
| 80% | 12,000 | $4,550 | $13,625 | Logbook +$9,075 |
Decline in value is shown as 25% diminishing value on the first year’s cost (8-year effective life). It falls each year, so the logbook advantage shrinks as the car gets older. The cost used for depreciation is capped at the car limit ($69,883 for 2026-27).
Logbook rules that trip people up
- The logbook must cover at least 12 continuous weeks that represent your normal driving.
- Write down each work trip: date, start and end odometer, km and the reason. Record the odometer at the start and end of the 12 weeks.
- One logbook is good for 5 years, as long as your driving pattern doesn’t change much.
- Keep receipts for everything except fuel, which you can estimate from odometer readings and the car’s consumption.
Our friendly rule of thumb
Under about 30% work use, or under 5,000 work km, cents per km is usually close enough and saves effort. Above that, especially with a newer car, try the logbook in the calculator above with your own numbers.
FAQ
When is the logbook method better than cents per km?
Usually when your work use is above about 30% or you drive more than 5,000 work km. In the example (15,000 km, 60% work use, $45,000 car) the logbook gives $10,219 versus $4,550.
How long do I need to keep a logbook?
For at least 12 continuous weeks. The logbook then stays valid for up to 5 years if your driving pattern stays about the same.
Can I switch between cents per km and logbook each year?
Yes. You can choose the method that gives the better result each income year, as long as you have the records the method needs.
Sources (checked 5 November 2026): Income Tax Assessment (Cents per Kilometre Deduction Rate for Car Expenses) Determination 2026, F2026L00785, registered 23 June 2026 (91c for 2026-27); ATO cents per kilometre method page; ATO Depreciating assets guide 2026 (car limit $69,674) and “Car thresholds from 1 July” (9 June 2026: car limit $69,883, LCT fuel-efficient $91,661); ATO Luxury car tax rate and thresholds; ATO FBT rates and thresholds (47%, gross-up 2.0802/1.8868, statutory 20%); Treasury joint media release “Fairer tax treatment to encourage affordable EVs” (5 May 2026) and ATO “Electric car discount” new-legislation page; Green Vehicle Guide (greenvehicleguide.gov.au); Australian Institute of Petroleum weekly prices (week ending 6 September 2026).