If you drive for work, the kilometres add up faster than you think. Here's how the two claim methods work, what the current rates are, and which trips the ATO will actually accept.
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By the Nomo team · Last reviewed 26 September 2026
If you use a car you own or lease for work, you work out your claim with one of two methods: cents per km or the logbook method. You can pick whichever gives the better result each year, and you can use a different method for each car.
| Cents per km | Logbook | |
|---|---|---|
| Rate or share | 88c per km for 2025–26, 91c for 2026–27 | Your work use % of the car's actual costs |
| Kilometre cap | 5,000 work km per car | No cap |
| Receipts for car costs | Not needed | Needed (fuel can be estimated from odometer readings) |
| Trip records | Show how you worked out the km | A 12 week logbook, valid up to 5 years |
| Usually suits | Occasional work driving | Heavy work driving or a costly car |
One rate covers everything: fuel, rego, insurance, servicing, repairs and the car losing value. You can't add any of those on top. You claim up to 5,000 work kilometres per car each year, so the most you can claim is $4,400 on a 2025–26 return and $4,550 for 2026–27.
No receipts are needed, but you must be able to show how you worked out the kilometres. A diary of work trips does the job. "About 4,000, probably" doesn't. Current rates and a cents per km calculator.
Drive a lot for work? The logbook method often pays more. You keep a logbook for 12 continuous weeks that reflect how you usually drive, which sets your work use percentage, and it can be used for up to five years. Then you claim that percentage of every car cost: fuel, servicing, rego, insurance, loan interest or lease payments, and the car's decline in value.
You need receipts for the costs, though fuel and oil can be a reasonable estimate based on your odometer readings. How to keep an ATO logbook.
Itinerant work, where you have no fixed workplace and move between sites all day, has its own rules. Which trips count, with worked examples.
Parking and tolls on work trips aren't car expenses, so you claim them separately, whichever method you use. Parking at or near your regular workplace and tolls on the commute aren't claimable. See the ATO's parking and tolls guide.
Cents per km and the logbook method are only for cars you own or lease. A few common situations work differently:
From 2026–27, eligible employees can take a standard deduction of up to $1,000 for work expenses with no receipts. Car expenses are one of the work expenses it covers, and anything you claim reduces the $1,000 dollar for dollar, so you get whichever is higher.
The break-even is lower than most people think: 1,100 work km at 91c is $1,001 on its own. How the $1,000 standard deduction works.
| Method | Keep |
|---|---|
| Cents per km | Date, km and purpose of each work trip, or another way to show how you worked out the km |
| Logbook | The 12 week logbook, odometer readings, and receipts for the car's costs |
| Parking and tolls | Receipts or statements, and which work trip each was for |
| Vehicles that aren't cars | Receipts for running costs and a record of work use |
Keep records for 5 years from when you lodge. More in receipts and record keeping.
Nomo tracks your drives automatically at the cents per km rate, and you sort each one to work or personal with a swipe, with the date, distance and purpose recorded. Nomo is an Australian tax deduction and mileage/work kilometre tracking app for PAYG employees and sole traders.
Nomo records odometer readings for your trips, works out your work use percentage and produces a 12 week logbook report for your tax agent. How Nomo's car logbook works.
Swipe right for work, left for personal.
A purpose on every work trip.
Every work trip for the year, with the total km.
See how Nomo tracks work kilometres.
Sole traders claim business car expenses in the business section of their return, with the same two methods for cars. The standard deduction doesn't cover business income. See sole trader tax deductions.
88 cents per km for the 2025–26 income year and 91 cents per km for 2026–27, up to 5,000 work kilometres per car.
No, but you need to be able to show how you worked out your work kilometres, such as a diary of work trips.
Usually not. The trip between home and your regular workplace is private, unless you carry bulky tools you can't leave at work or your work is itinerant.
It depends on how far you drive for work and what the car costs to run. Past 5,000 work kilometres, cents per km stops counting, so the logbook often wins.
Yes, for work trips, and separately from your car expenses. Not for parking at your regular workplace or tolls on your commute.
If it's built to carry one tonne or more, it isn't a car for tax purposes. You claim the actual work-related costs with receipts and a record of work use.
Not the running costs, because you don't own or lease it yourself. You can claim parking and tolls for work trips.
Every work kilometre, counted.
Trips recorded as you drive and sorted with a swipe. 14 days free, no card needed.
Start 14-day free trialBy the Nomo team · Last reviewed 26 September 2026. We check these pages against current ATO guidance and update them when the rules change.
General information only, not tax advice. Rules change and everyone’s situation is different, so check ato.gov.au or talk to a registered tax agent about your situation. Nomo is a record keeping app, not a registered tax agent.