Inland Revenue has advised the new mileage rate for motor vehicles is 77 cents per kilometre. This rate applies to self employed taxpayers with up to a
maximum of 5,000 kilometres of work-related travel each year. This applies to all motor vehicles (except motor cycles) irrespective of their engine sizes or whether powered by petrol or diesel and applies from the 2011-2012 income year onwards.
The rate may be used by employers reimbursing employees for the business use of an employee's motor vehicle. This entitlement extends to shareholder- employees as well. However, there are other options may be used to establish a fair and reasonable rate for claims or reimbursements (for example, AA rates). If you would like to discuss how these measures may affect you, please contact us.