Kilometre rates for the business use of vehicles for the 2024 income year
The table of rates for the 2023/2024 income year for motor vehicle expenditure claims.
In accordance with s DE 12(4) the Commissioner is, from time-to-time, required to set and publish kilometre rates for business customers. This is done at least once per year and the rates are set retrospectively to reflect vehicle operating costs likely incurred for the previous income year (i.e. in this item, the year ended 31 March 2024). Alternatively, business customers may choose to keep records of actual vehicle expenditure to calculate expenditure claims for the business use of a motor vehicle.
It is accepted that these rates may also be used by employers as a reasonable estimate for reimbursement of expenditure incurred by employees for the use of a private motor vehicle for business purposes in a current income year (1 April onwards), as provided in s CW 17(3)(a). However, employers are reminded that these rates are set retrospectively and may not reflect actual day-to-day motor vehicle running costs. More information is available on the Inland Revenue website www.ird.govt.nz/ (search keywords “claiming vehicle expenses”).
The rates set out below apply for the 2023/2024 income year for business motor vehicle expenditure claims. The Tier one rates reflect an overall increase in vehicle running costs largely due to fuel costs, insurance and interest rates.
The Tier two rate is for running costs only. Use the Tier two rate for the business portion of any travel over 14,000 kms in a year.
The table of rates for the 2024 income year
| Vehicle Type | Tier One Rate | Tier Two Rate |
|---|---|---|
| Petrol or Diesel | $1.04 | 35 cents |
| Petrol Hybrid | $1.04 | 21 cents |
| Electric | $1.04 | 12 cents |
See the related operational statements for further information on the use of the kilometre rates.
Tax Information Bulletin - Vol 36 No 6, July 2024