Luxury Cars

LCT is usually only payable on new cars and used demonstrator vehicles less than 2 years old.

From 1 July 2008 cars with a GST inclusive value above the luxury car tax threshold are subject to a luxury car tax at the rate of 33%. (25% prior to 1 July 2008.)

From 3 October 2008 exemption is available for "fuel-efficient" which cost less than $75,000 (indexed).

In certain circumstances refunds of the additional LCT are available for some farm vehicles and those used by tourism operators. Refer to the links below for more details.

 Luxury car tax on the supply of a luxury car is:

      = (luxury car tax value – luxury car tax threshold) x 10/11 x 33%

The luxury car tax value is the price of the car, including GST and customs duty, less:

> any luxury car tax included in the supply, and
 

> any other Australian tax, fee or charge.

The price includes GST and any customs duty, dealer delivery charges, and standard and statutory warranties.

Generally it excludes any other Australian tax, fee or charges (for example, stamp duty, transfer fees, registration, compulsory third party insurance, extended warranties and costs associated with financing the purchase of the car).

Refer to the link below for details of the “Car Depreciation Limit” which from 1 July 2012 is no longer the same as the “Luxury Car Tax Threshold"

If the car has a fuel consumption not exceeding 7 litres per 100 kilometres as a combined rating under vehicle standards in force under section 7 of the Motor Vehicle Standards Act 1989, the luxury car tax threshold is the fuel-efficient car limit for the year in which the supply of the car occurred, or the car was entered for home consumption.
 

NB! Although no Luxury Car Tax is applied until the above threshold is reached, the maximum GST credit that can be claimed is the same as that which applies to luxury cars that are not fuel efficient.

The luxury car tax threshold is used to determine if luxury car tax is payable.

The maximum GST credit is linked to the Car Depreciation Limit.

Refer to the link below for details of the “Car Depreciation Limit” which from 1 July 2012 is no longer the same as the “Luxury Car Tax Threshold”