As per current laws, car expenses for business purposes can be written off in your tax return. However, there are some limitations and exceptions to this rule that you should be aware of.
Firstly, the expenses must be related to the operation of your business or employment duties. Commuting to and from work does not count as a business expense. The expenses must also be reasonable and necessary. In other words, they should be necessary for the smooth functioning of your business or to earn an income.
Secondly, you must keep accurate records of all car-related expenses, including fuel, maintenance, repairs, insurance, and depreciation. This will help you calculate the exact amount that can be claimed as a deduction on your tax return.
Lasty, there are different methods of calculating car expenses for tax purposes, such as the cents-per-kilometer method or the logbook method. It's important to choose the method that is best suited for your circumstances and keep proper records to support your claim.
If you're unsure about how to claim car expenses on your tax return or have any other questions related to business taxation, it's recommended that you seek advice from a licensed accountant or tax agent.
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