Class Ruling CR 2019/52

What this ruling is about: 1. This Ruling sets out the tax consequences of using the Netstar GPS Tracking System for calculating the taxable value of a car fringe benefit using the cost basis method. 2. Full details of the Netstar GPS Tracking System are set out in paragraphs 11 to 32 of this Ruling. Note: By issuing this Ruling, the ATO is not endorsing this product. Potential users must form their own view about the product. Who this Ruling applies to 3. This Ruling applies to you if you are an employer who uses the Netstar Australia Pty Ltd telematics system (Netstar telematics system) for car logbook and odometer records. When this Ruling applies 4. This Ruling applies from 1 April 2019 to 31 March 2024. 5. The Netstar telematics system 'FBT Logbook Report' satisfies the definition of 'log book records' in subsection 136(1) [1] provided: 6. The Netstar telematics system FBT Logbook Report satisfies the definition of 'odometer records' in subsection 136(1). 7. An employer in a logbook year of tax who uses the Netstar telematics system FBT Logbook Report continuously for: satisfies the requirement in section 10A and is entitled to claim a reduction of operating costs. 8. An employer in a logbook year of tax who uses the Netstar telematics system FBT Logbook Report continuously for: satisfies the requirements in section 10A and is entitled to claim a reduction of operating costs provided the employer: 9. An employer in a non-logbook year of tax that uses the Netstar telematics system FBT Logbook Report continuously for the whole of the holding period (as defined in section 162C), satisfies the requirements in section 10B and is entitled to claim a reduction of operating costs. 10. An employer in a non-logbook year of tax who has used the Netstar telematics system 'FBT Logbook Report' in one of the previous four FBT years continuously for an 'applicable logbook period' but: satisfies the requirements in section 10B and will be entitled to claim a reduction of operating costs of the car on account of business journeys undertaken in the car during the holding period provided the employer: 11. The following description of the scheme is based on information provided by the applicant. If the scheme is not carried out as described, this Ruling cannot be relied upon. 12. Other information referenced is as follows: 13. Netstar Australia Holdings Pty Ltd acquired 100% of the shares of Fleet Logistics who traded as EZY2C in 2017. The EZY2C GPS Tracking System described in Class Ruling CR 2017/76 Fringe benefits tax: employers who use the EZY2C telematics system (EZY2C GPS Tracking System) for car log book record and odometer record keeping requirements issued to Fleet Logistics is now owned by Netstar Australia Pty Ltd (Netstar). 14. This telematics solution which is now owned by Netstar is exactly the same as that outlined in CR 2017/76 and the information provided in the original application to the Commissioner of Taxation (the Commissioner). 15. Netstar had developed a wide range of the most advanced GPS tracking devices and accessories as a means of recording car logbook entries. Solutions include 3G, Next G, Satellite and Hybrid (herein referred to as 'Netstar's telematics solution'). 16. A key attribute of Netstar's telematics solution allows car locations to be accurately tracked (and remotely recorded) using GPS locations. This information feeds back to a centralised database, which then allows the employers to view and download logbook and odometer records. 17. The Netstar telematics solution consists of an in-vehicle telematics device which has a built in GPS receiver that is used for capturing GPS locations. The in-vehicle telematics device is hardwired to the electronics system of the car or plugged into the OBDII Port. 18. The GPS locations are captured, then used to calculate odometer readings (distance travelled) of the particular car. 19. For each journey completed, the Netstar telematics device records: 20. Specifically, the Netstar telematics device: 21. In the event the Netstar telematics device is operating within an area in which 3G coverage is not available, it stores the data on-board and automatically transmits the stored data back to the centralised telematics platform (that is, the Netstar database) when access to 3G communication coverage is restored. 22. The Netstar telematics system provides customers with two easy options to capture business or private journey declarations for the purpose of electronic logbook journey reporting. 23. The functionality available to Netstar's customers is for each driver to use either Netstar's 'Mobile/tablet' platform (a mobile and tablet responsive portal) or logging into Netstar's online portal via its website to manually select whether a journey has been undertaken for business or private purposes. 24. An employee logs in via either Netstar's 'Mobile/tablet' platform or Netstar's online portal, and identifies themselves as the applicable driver of the car for that journey by linking their journey. In the event the telematics device is moved to another vehicle, customers contact Netstar to reactivate the device in the new (replacement) vehicle. 25. In the event that an employee does not input the nature of the particular journey undertaken (that is, for business or private purposes), the Netstar telematics system will automatically allocate the journey as being for private purposes. Trip Report 26. The employer can then use the information contained within the Netstar database to generate a Trip Report on a weekly basis at minimum or on demand as required, which details each individual journey undertaken by each vehicle. 27. The Trip Report provides the following information for each journey undertaken in the selected period: 28. In relation to the trip purpose, each Netstar client can customise the trip purpose reason in the Trip Report to suit their own business. That is, Netstar clients may wish to have any number of trip purposes all relating to the business usage, for example client care visit, call out trip, delivery, etcetera. 29. An employer will use the Netstar system to produce, in English, a Trip Report for any selected period for each car that has the system fitted and/or each employee who uses the car that has the system fitted. FBT Logbook Report 30. Further to the paragraphs 26 to 29 of this Ruling, the employer can then use the information contained to generate a 'FBT Logbook Report' which provides details of the calculated business use percentages for the selected period. 31. The FBT Logbook Report provides: 32. Employers using the Netstar telematics solution will make an election to treat a current year of tax as a 'logbook year of tax'. Commissioner of Taxation 11 September 2019 Does the Netstar telematics system 'FBT Logbook Report' meet the relevant requirements of section 10A? 33. Section 10A states: NO REDUCTION OF OPERATING COST IN A LOG BOOK YEAR OF TAX UNLESS LOG BOOK RECORDS AND ODOMETER RECORDS ARE MAINTAINED 34. Section 162G(1) sets out various circumstances under which a particular year can be treated as a 'log book year of tax' as follows: 35. It is accepted that employers using the Netstar telematics system 'FBT Logbook Report' will make an election under paragraph 162G(1)(b) to treat a current year of tax as a 'logbook year of tax'. Does the Netstar telematics system 'FBT Logbook Report' satisfy the requirements of the definition of 'log book records'? 36. Subsection 136(1) defines 'log book records' as: 37. The definition of 'log book records' in subsection 136(1) requires that the relevant record be a 'daily log book or similar document' and also the relevant entries are 'made in the English language at, or as soon as reasonably practicable after, the end of the journey.' 38. The Netstar telematics device collects all applicable information for each journey undertaken by a car (that is, the location of the start and end of a journey, date and time of the start and end of a journey, purpose of each journey, kilometres travelled as per the GPS co-ordinates), and automatically sends it to Netstar's centralised server. 39. The business use or private use details for the journey are input by each respective driver either through the use of Netstar's mobile/tablet platform or through Netstar's online portal. The employer can then use the Netstar system to produce, in English, a 'Trip Report' and 'FBT Logbook Report' for the selected period. 40. Paragraph (d) of the definition of 'log book records' in subsection 136(1), requires the respective odometer readings of the car at the beginning and at the end of the journey be entered into the relevant records. 41. The term 'odometer' is not defined in either the FBTAA or the Income Tax Assessment Act 1997 but the Macquarie Dictionary , online edition, defines that term as being, 'an instrument for measuring distance passed over, as by a motor vehicle.' 42. The term 'odometer records', as defined in subsection 136(1) makes reference to 'odometer readings of the car'. Whilst odometer readings must pertain to the car, it does not necessarily mean that they must also be attributable either wholly or in part to the rotation of the car's wheels, thereby mechanically moving the standard odometer fitted in the car by the manufacturer. 43. Each time the car is driven, the start and end odometer readings for the journey are automatically calculated by the Netstar telematics system from the GPS and other telemetry data recorded. 44. It is accepted that the opening and closing odometer readings for each car journey detailed on the 'FBT Logbook Report' satisfies the requirements of paragraph (d) of the definition of 'log book records' in subsection 136(1). 45. The 'Trip Report' and 'FBT Logbook Report' both record the following: thus satisfying paragraphs (c), (e) and (f) of the definition of 'log book records' in subsection 136(1). 46. It is considered that the Netstar telematics system 'FBT Logbook Report' is 'a daily logbook or similar document' that satisfies the requirement of being made in the English language at or a soon as reasonably practicable after the end of the journey. 47. The report generated by the Netstar telematics system 'FBT Logbook Report' satisfies the definition of 'log book records' in subsection 136(1) provided the report is completed for an 'applicable log book period'. 48. The definition of 'log book records' in subsection 136(1) also requires that each business journey recorded in the logbook records be in relation to a 'period'. Paragraph 10A(a) refers to 'log book records' being maintained for an 'applicable log book period'. 49. The term 'applicable log book period' is defined in subsection 162H(1) as follows: 162H APPLICABLE LOG BOOK PERIOD 50. It is accepted that all employers using the 'FBT Logbook Report' produced by the Netstar telematics system in relation to any car fringe benefits they provide will maintain the necessary records for the duration of the 'applicable log book period'. 51. It is accepted that the Netstar telematics system 'FBT Logbook Report' satisfies all the relevant requirements of the definition of 'log book records' as defined in subsection 136(1). Does the Netstar telematics system 'FBT Logbook Report' satisfy the requirements of the definition of 'odometer records'? 52. The term 'odometer records' is defined in subsection 136(1) as: 53. The definition of 'odometer records' in subsection 136(1) requires that odometer readings be recorded both at the 'commencement' and at the 'end' of the periods. 54. The 'FBT Logbook Report' provides details of the odometer reading for the car at the start of the first recorded journey and also the odometer reading for the car at the end of the last recorded journey that were undertaken during each report period. 55. As stated in paragraph 50 of this Ruling, it is accepted that all employers using the Netstar telematics system 'FBT Logbook Report' in relation to any car fringe benefits they provide will maintain the necessary records for the duration of the 'applicable log book period'. 56. As stated in paragraph 46 of this Ruling, the report provided by the Netstar telematics system 'FBT Logbook Report' meets the necessary requirement of having entries 'made in the English language at, or as soon as reasonably practicable after, the end of the journey'. 57. It is considered that the Netstar telematics system 'FBT Logbook Report' satisfies all the relevant requirements of the definition of 'odometer records' as defined in subsection 136(1). 58. Paragraph 10A(b) requires odometer records to be maintained for the holding period as defined in section 162C. 59. The Netstar telematics system 'FBT Logbook Report' will provide odometer records for the period of the year in which the system is used. Therefore, where the system is used continuously for the whole of the period of the year for which the car is held, the report will provide the odometer records for the holding period. 60. However, if the system is not continuously used for the whole of the period of the year for which the car is held, the reports will not provide both the start and end odometer readings for the holding period. For example, if the car is held for the full year but the Netstar telematics system 'FBT Logbook Report' is only used for the first 12 weeks of the year, the reports will only provide the odometer reading as at the start of the holding period. The reports will not provide the odometer reading for the end of the year (the end of the holding period). Therefore, in such a situation, the odometer reading at the end of the period will need to be separately recorded for the reports to provide odometer records for the holding period. Does the Netstar telematics system 'FBT Logbook Report' meet the relevant requirements of section 10B? 61. Section 10B states: NO REDUCTION OF OPERATING COST IN A NON-LOG BOOK YEAR OF TAX UNLESS LOG BOOK RECORDS AND ODOMETER RECORDS ARE MAINTAINED IN LOG BOOK YEAR OF TAX 62. Where the Netstar GPS Tracking System is used continuously for the whole of the holding period, the FBT Logbook Report will meet all the necessary requirements of section 10B in a non-logbook year of tax as: 63. An employer in a non-logbook year of tax who does not use the Netstar telematics system 'FBT Logbook Report' in that year of tax or does not use it for the whole of the period that the car is held but has used the system in one of the previous four FBT years continuously for an 'applicable log book period', will not by itself satisfy the requirements of section 10B. The employer will also need to: © AUSTRALIAN TAXATION OFFICE FOR THE COMMONWEALTH OF AUSTRALIA You are free to copy, adapt, modify, transmit and distribute this material as you wish (but not in any way that suggests the ATO or the Commonwealth endorses you or any of your services or products). Not previously issued as a draft

Class of entities or scheme: 11. The following description of the scheme is based on information provided by the applicant. If the scheme is not carried out as described, this Ruling cannot be relied upon. 12. Other information referenced is as follows: 13. Netstar Australia Holdings Pty Ltd acquired 100% of the shares of Fleet Logistics who traded as EZY2C in 2017. The EZY2C GPS Tracking System described in Class Ruling CR 2017/76 Fringe benefits tax: employers who use the EZY2C telematics system (EZY2C GPS Tracking System) for car log book record and odometer record keeping requirements issued to Fleet Logistics is now owned by Netstar Australia Pty Ltd (Netstar). 14. This telematics solution which is now owned by Netstar is exactly the same as that outlined in CR 2017/76 and the information provided in the original application to the Commissioner of Taxation (the Commissioner). 15. Netstar had developed a wide range of the most advanced GPS tracking devices and accessories as a means of recording car logbook entries. Solutions include 3G, Next G, Satellite and Hybrid (herein referred to as 'Netstar's telematics solution'). 16. A key attribute of Netstar's telematics solution allows car locations to be accurately tracked (and remotely recorded) using GPS locations. This information feeds back to a centralised database, which then allows the employers to view and download logbook and odometer records. 17. The Netstar telematics solution consists of an in-vehicle telematics device which has a built in GPS receiver that is used for capturing GPS locations. The in-vehicle telematics device is hardwired to the electronics system of the car or plugged into the OBDII Port. 18. The GPS locations are captured, then used to calculate odometer readings (distance travelled) of the particular car. 19. For each journey completed, the Netstar telematics device records: 20. Specifically, the Netstar telematics device: 21. In the event the Netstar telematics device is operating within an area in which 3G coverage is not available, it stores the data on-board and automatically transmits the stored data back to the centralised telematics platform (that is, the Netstar database) when access to 3G communication coverage is restored. 22. The Netstar telematics system provides customers with two easy options to capture business or private journey declarations for the purpose of electronic logbook journey reporting. 23. The functionality available to Netstar's customers is for each driver to use either Netstar's 'Mobile/tablet' platform (a mobile and tablet responsive portal) or logging into Netstar's online portal via its website to manually select whether a journey has been undertaken for business or private purposes. 24. An employee logs in via either Netstar's 'Mobile/tablet' platform or Netstar's online portal, and identifies themselves as the applicable driver of the car for that journey by linking their journey. In the event the telematics device is moved to another vehicle, customers contact Netstar to reactivate the device in the new (replacement) vehicle. 25. In the event that an employee does not input the nature of the particular journey undertaken (that is, for business or private purposes), the Netstar telematics system will automatically allocate the journey as being for private purposes. | Trip Report: 26. The employer can then use the information contained within the Netstar database to generate a Trip Report on a weekly basis at minimum or on demand as required, which details each individual journey undertaken by each vehicle. 27. The Trip Report provides the following information for each journey undertaken in the selected period: 28. In relation to the trip purpose, each Netstar client can customise the trip purpose reason in the Trip Report to suit their own business. That is, Netstar clients may wish to have any number of trip purposes all relating to the business usage, for example client care visit, call out trip, delivery, etcetera. 29. An employer will use the Netstar system to produce, in English, a Trip Report for any selected period for each car that has the system fitted and/or each employee who uses the car that has the system fitted. | FBT Logbook Report: 30. Further to the paragraphs 26 to 29 of this Ruling, the employer can then use the information contained to generate a 'FBT Logbook Report' which provides details of the calculated business use percentages for the selected period. 31. The FBT Logbook Report provides: 32. Employers using the Netstar telematics solution will make an election to treat a current year of tax as a 'logbook year of tax'. Commissioner of Taxation 11 September 2019

Ruling: 1. This Ruling sets out the tax consequences of using the Netstar GPS Tracking System for calculating the taxable value of a car fringe benefit using the cost basis method. 2. Full details of the Netstar GPS Tracking System are set out in paragraphs 11 to 32 of this Ruling. Note: By issuing this Ruling, the ATO is not endorsing this product. Potential users must form their own view about the product. | Who this Ruling applies to: 3. This Ruling applies to you if you are an employer who uses the Netstar Australia Pty Ltd telematics system (Netstar telematics system) for car logbook and odometer records. | When this Ruling applies: 4. This Ruling applies from 1 April 2019 to 31 March 2024. 5. The Netstar telematics system 'FBT Logbook Report' satisfies the definition of 'log book records' in subsection 136(1) [1] provided: 6. The Netstar telematics system FBT Logbook Report satisfies the definition of 'odometer records' in subsection 136(1). 7. An employer in a logbook year of tax who uses the Netstar telematics system FBT Logbook Report continuously for: satisfies the requirement in section 10A and is entitled to claim a reduction of operating costs. 8. An employer in a logbook year of tax who uses the Netstar telematics system FBT Logbook Report continuously for: satisfies the requirements in section 10A and is entitled to claim a reduction of operating costs provided the employer: 9. An employer in a non-logbook year of tax that uses the Netstar telematics system FBT Logbook Report continuously for the whole of the holding period (as defined in section 162C), satisfies the requirements in section 10B and is entitled to claim a reduction of operating costs. 10. An employer in a non-logbook year of tax who has used the Netstar telematics system 'FBT Logbook Report' in one of the previous four FBT years continuously for an 'applicable logbook period' but: satisfies the requirements in section 10B and will be entitled to claim a reduction of operating costs of the car on account of business journeys undertaken in the car during the holding period provided the employer: 11. The following description of the scheme is based on information provided by the applicant. If the scheme is not carried out as described, this Ruling cannot be relied upon. 12. Other information referenced is as follows: 13. Netstar Australia Holdings Pty Ltd acquired 100% of the shares of Fleet Logistics who traded as EZY2C in 2017. The EZY2C GPS Tracking System described in Class Ruling CR 2017/76 Fringe benefits tax: employers who use the EZY2C telematics system (EZY2C GPS Tracking System) for car log book record and odometer record keeping requirements issued to Fleet Logistics is now owned by Netstar Australia Pty Ltd (Netstar). 14. This telematics solution which is now owned by Netstar is exactly the same as that outlined in CR 2017/76 and the information provided in the original application to the Commissioner of Taxation (the Commissioner). 15. Netstar had developed a wide range of the most advanced GPS tracking devices and accessories as a means of recording car logbook entries. Solutions include 3G, Next G, Satellite and Hybrid (herein referred to as 'Netstar's telematics solution'). 16. A key attribute of Netstar's telematics solution allows car locations to be accurately tracked (and remotely recorded) using GPS locations. This information feeds back to a centralised database, which then allows the employers to view and download logbook and odometer records. 17. The Netstar telematics solution consists of an in-vehicle telematics device which has a built in GPS receiver that is used for capturing GPS locations. The in-vehicle telematics device is hardwired to the electronics system of the car or plugged into the OBDII Port. 18. The GPS locations are captured, then used to calculate odometer readings (distance travelled) of the particular car. 19. For each journey completed, the Netstar telematics device records: 20. Specifically, the Netstar telematics device: 21. In the event the Netstar telematics device is operating within an area in which 3G coverage is not available, it stores the data on-board and automatically transmits the stored data back to the centralised telematics platform (that is, the Netstar database) when access to 3G communication coverage is restored. 22. The Netstar telematics system provides customers with two easy options to capture business or private journey declarations for the purpose of electronic logbook journey reporting. 23. The functionality available to Netstar's customers is for each driver to use either Netstar's 'Mobile/tablet' platform (a mobile and tablet responsive portal) or logging into Netstar's online portal via its website to manually select whether a journey has been undertaken for business or private purposes. 24. An employee logs in via either Netstar's 'Mobile/tablet' platform or Netstar's online portal, and identifies themselves as the applicable driver of the car for that journey by linking their journey. In the event the telematics device is moved to another vehicle, customers contact Netstar to reactivate the device in the new (replacement) vehicle. 25. In the event that an employee does not input the nature of the particular journey undertaken (that is, for business or private purposes), the Netstar telematics system will automatically allocate the journey as being for private purposes. | Trip Report: 26. The employer can then use the information contained within the Netstar database to generate a Trip Report on a weekly basis at minimum or on demand as required, which details each individual journey undertaken by each vehicle. 27. The Trip Report provides the following information for each journey undertaken in the selected period: 28. In relation to the trip purpose, each Netstar client can customise the trip purpose reason in the Trip Report to suit their own business. That is, Netstar clients may wish to have any number of trip purposes all relating to the business usage, for example client care visit, call out trip, delivery, etcetera. 29. An employer will use the Netstar system to produce, in English, a Trip Report for any selected period for each car that has the system fitted and/or each employee who uses the car that has the system fitted. | FBT Logbook Report: 30. Further to the paragraphs 26 to 29 of this Ruling, the employer can then use the information contained to generate a 'FBT Logbook Report' which provides details of the calculated business use percentages for the selected period. 31. The FBT Logbook Report provides: 32. Employers using the Netstar telematics solution will make an election to treat a current year of tax as a 'logbook year of tax'. Commissioner of Taxation 11 September 2019 | Does the Netstar telematics system 'FBT Logbook Report' meet the relevant requirements of section 10A?: 33. Section 10A states: NO REDUCTION OF OPERATING COST IN A LOG BOOK YEAR OF TAX UNLESS LOG BOOK RECORDS AND ODOMETER RECORDS ARE MAINTAINED 34. Section 162G(1) sets out various circumstances under which a particular year can be treated as a 'log book year of tax' as follows: 35. It is accepted that employers using the Netstar telematics system 'FBT Logbook Report' will make an election under paragraph 162G(1)(b) to treat a current year of tax as a 'logbook year of tax'. | Does the Netstar telematics system 'FBT Logbook Report' satisfy the requirements of the definition of 'log book records'?: 36. Subsection 136(1) defines 'log book records' as: 37. The definition of 'log book records' in subsection 136(1) requires that the relevant record be a 'daily log book or similar document' and also the relevant entries are 'made in the English language at, or as soon as reasonably practicable after, the end of the journey.' 38. The Netstar telematics device collects all applicable information for each journey undertaken by a car (that is, the location of the start and end of a journey, date and time of the start and end of a journey, purpose of each journey, kilometres travelled as per the GPS co-ordinates), and automatically sends it to Netstar's centralised server. 39. The business use or private use details for the journey are input by each respective driver either through the use of Netstar's mobile/tablet platform or through Netstar's online portal. The employer can then use the Netstar system to produce, in English, a 'Trip Report' and 'FBT Logbook Report' for the selected period. 40. Paragraph (d) of the definition of 'log book records' in subsection 136(1), requires the respective odometer readings of the car at the beginning and at the end of the journey be entered into the relevant records. 41. The term 'odometer' is not defined in either the FBTAA or the Income Tax Assessment Act 1997 but the Macquarie Dictionary , online edition, defines that term as being, 'an instrument for measuring distance passed over, as by a motor vehicle.' 42. The term 'odometer records', as defined in subsection 136(1) makes reference to 'odometer readings of the car'. Whilst odometer readings must pertain to the car, it does not necessarily mean that they must also be attributable either wholly or in part to the rotation of the car's wheels, thereby mechanically moving the standard odometer fitted in the car by the manufacturer. 43. Each time the car is driven, the start and end odometer readings for the journey are automatically calculated by the Netstar telematics system from the GPS and other telemetry data recorded. 44. It is accepted that the opening and closing odometer readings for each car journey detailed on the 'FBT Logbook Report' satisfies the requirements of paragraph (d) of the definition of 'log book records' in subsection 136(1). 45. The 'Trip Report' and 'FBT Logbook Report' both record the following: thus satisfying paragraphs (c), (e) and (f) of the definition of 'log book records' in subsection 136(1). 46. It is considered that the Netstar telematics system 'FBT Logbook Report' is 'a daily logbook or similar document' that satisfies the requirement of being made in the English language at or a soon as reasonably practicable after the end of the journey. 47. The report generated by the Netstar telematics system 'FBT Logbook Report' satisfies the definition of 'log book records' in subsection 136(1) provided the report is completed for an 'applicable log book period'. 48. The definition of 'log book records' in subsection 136(1) also requires that each business journey recorded in the logbook records be in relation to a 'period'. Paragraph 10A(a) refers to 'log book records' being maintained for an 'applicable log book period'. 49. The term 'applicable log book period' is defined in subsection 162H(1) as follows: 162H APPLICABLE LOG BOOK PERIOD 50. It is accepted that all employers using the 'FBT Logbook Report' produced by the Netstar telematics system in relation to any car fringe benefits they provide will maintain the necessary records for the duration of the 'applicable log book period'. 51. It is accepted that the Netstar telematics system 'FBT Logbook Report' satisfies all the relevant requirements of the definition of 'log book records' as defined in subsection 136(1). | Does the Netstar telematics system 'FBT Logbook Report' satisfy the requirements of the definition of 'odometer records'?: 52. The term 'odometer records' is defined in subsection 136(1) as: 53. The definition of 'odometer records' in subsection 136(1) requires that odometer readings be recorded both at the 'commencement' and at the 'end' of the periods. 54. The 'FBT Logbook Report' provides details of the odometer reading for the car at the start of the first recorded journey and also the odometer reading for the car at the end of the last recorded journey that were undertaken during each report period. 55. As stated in paragraph 50 of this Ruling, it is accepted that all employers using the Netstar telematics system 'FBT Logbook Report' in relation to any car fringe benefits they provide will maintain the necessary records for the duration of the 'applicable log book period'. 56. As stated in paragraph 46 of this Ruling, the report provided by the Netstar telematics system 'FBT Logbook Report' meets the necessary requirement of having entries 'made in the English language at, or as soon as reasonably practicable after, the end of the journey'. 57. It is considered that the Netstar telematics system 'FBT Logbook Report' satisfies all the relevant requirements of the definition of 'odometer records' as defined in subsection 136(1). 58. Paragraph 10A(b) requires odometer records to be maintained for the holding period as defined in section 162C. 59. The Netstar telematics system 'FBT Logbook Report' will provide odometer records for the period of the year in which the system is used. Therefore, where the system is used continuously for the whole of the period of the year for which the car is held, the report will provide the odometer records for the holding period. 60. However, if the system is not continuously used for the whole of the period of the year for which the car is held, the reports will not provide both the start and end odometer readings for the holding period. For example, if the car is held for the full year but the Netstar telematics system 'FBT Logbook Report' is only used for the first 12 weeks of the year, the reports will only provide the odometer reading as at the start of the holding period. The reports will not provide the odometer reading for the end of the year (the end of the holding period). Therefore, in such a situation, the odometer reading at the end of the period will need to be separately recorded for the reports to provide odometer records for the holding period. | Does the Netstar telematics system 'FBT Logbook Report' meet the relevant requirements of section 10B?: 61. Section 10B states: NO REDUCTION OF OPERATING COST IN A NON-LOG BOOK YEAR OF TAX UNLESS LOG BOOK RECORDS AND ODOMETER RECORDS ARE MAINTAINED IN LOG BOOK YEAR OF TAX 62. Where the Netstar GPS Tracking System is used continuously for the whole of the holding period, the FBT Logbook Report will meet all the necessary requirements of section 10B in a non-logbook year of tax as: 63. An employer in a non-logbook year of tax who does not use the Netstar telematics system 'FBT Logbook Report' in that year of tax or does not use it for the whole of the period that the car is held but has used the system in one of the previous four FBT years continuously for an 'applicable log book period', will not by itself satisfy the requirements of section 10B. The employer will also need to: © AUSTRALIAN TAXATION OFFICE FOR THE COMMONWEALTH OF AUSTRALIA You are free to copy, adapt, modify, transmit and distribute this material as you wish (but not in any way that suggests the ATO or the Commonwealth endorses you or any of your services or products). Not previously issued as a draft


Appendix: Does the Netstar telematics system 'FBT Logbook Report' meet the relevant requirements of section 10A?: 33. Section 10A states: NO REDUCTION OF OPERATING COST IN A LOG BOOK YEAR OF TAX UNLESS LOG BOOK RECORDS AND ODOMETER RECORDS ARE MAINTAINED 34. Section 162G(1) sets out various circumstances under which a particular year can be treated as a 'log book year of tax' as follows: 35. It is accepted that employers using the Netstar telematics system 'FBT Logbook Report' will make an election under paragraph 162G(1)(b) to treat a current year of tax as a 'logbook year of tax'. | Does the Netstar telematics system 'FBT Logbook Report' satisfy the requirements of the definition of 'log book records'?: 36. Subsection 136(1) defines 'log book records' as: 37. The definition of 'log book records' in subsection 136(1) requires that the relevant record be a 'daily log book or similar document' and also the relevant entries are 'made in the English language at, or as soon as reasonably practicable after, the end of the journey.' 38. The Netstar telematics device collects all applicable information for each journey undertaken by a car (that is, the location of the start and end of a journey, date and time of the start and end of a journey, purpose of each journey, kilometres travelled as per the GPS co-ordinates), and automatically sends it to Netstar's centralised server. 39. The business use or private use details for the journey are input by each respective driver either through the use of Netstar's mobile/tablet platform or through Netstar's online portal. The employer can then use the Netstar system to produce, in English, a 'Trip Report' and 'FBT Logbook Report' for the selected period. 40. Paragraph (d) of the definition of 'log book records' in subsection 136(1), requires the respective odometer readings of the car at the beginning and at the end of the journey be entered into the relevant records. 41. The term 'odometer' is not defined in either the FBTAA or the Income Tax Assessment Act 1997 but the Macquarie Dictionary , online edition, defines that term as being, 'an instrument for measuring distance passed over, as by a motor vehicle.' 42. The term 'odometer records', as defined in subsection 136(1) makes reference to 'odometer readings of the car'. Whilst odometer readings must pertain to the car, it does not necessarily mean that they must also be attributable either wholly or in part to the rotation of the car's wheels, thereby mechanically moving the standard odometer fitted in the car by the manufacturer. 43. Each time the car is driven, the start and end odometer readings for the journey are automatically calculated by the Netstar telematics system from the GPS and other telemetry data recorded. 44. It is accepted that the opening and closing odometer readings for each car journey detailed on the 'FBT Logbook Report' satisfies the requirements of paragraph (d) of the definition of 'log book records' in subsection 136(1). 45. The 'Trip Report' and 'FBT Logbook Report' both record the following: thus satisfying paragraphs (c), (e) and (f) of the definition of 'log book records' in subsection 136(1). 46. It is considered that the Netstar telematics system 'FBT Logbook Report' is 'a daily logbook or similar document' that satisfies the requirement of being made in the English language at or a soon as reasonably practicable after the end of the journey. 47. The report generated by the Netstar telematics system 'FBT Logbook Report' satisfies the definition of 'log book records' in subsection 136(1) provided the report is completed for an 'applicable log book period'. 48. The definition of 'log book records' in subsection 136(1) also requires that each business journey recorded in the logbook records be in relation to a 'period'. Paragraph 10A(a) refers to 'log book records' being maintained for an 'applicable log book period'. 49. The term 'applicable log book period' is defined in subsection 162H(1) as follows: 162H APPLICABLE LOG BOOK PERIOD 50. It is accepted that all employers using the 'FBT Logbook Report' produced by the Netstar telematics system in relation to any car fringe benefits they provide will maintain the necessary records for the duration of the 'applicable log book period'. 51. It is accepted that the Netstar telematics system 'FBT Logbook Report' satisfies all the relevant requirements of the definition of 'log book records' as defined in subsection 136(1). | Does the Netstar telematics system 'FBT Logbook Report' satisfy the requirements of the definition of 'odometer records'?: 52. The term 'odometer records' is defined in subsection 136(1) as: 53. The definition of 'odometer records' in subsection 136(1) requires that odometer readings be recorded both at the 'commencement' and at the 'end' of the periods. 54. The 'FBT Logbook Report' provides details of the odometer reading for the car at the start of the first recorded journey and also the odometer reading for the car at the end of the last recorded journey that were undertaken during each report period. 55. As stated in paragraph 50 of this Ruling, it is accepted that all employers using the Netstar telematics system 'FBT Logbook Report' in relation to any car fringe benefits they provide will maintain the necessary records for the duration of the 'applicable log book period'. 56. As stated in paragraph 46 of this Ruling, the report provided by the Netstar telematics system 'FBT Logbook Report' meets the necessary requirement of having entries 'made in the English language at, or as soon as reasonably practicable after, the end of the journey'. 57. It is considered that the Netstar telematics system 'FBT Logbook Report' satisfies all the relevant requirements of the definition of 'odometer records' as defined in subsection 136(1). 58. Paragraph 10A(b) requires odometer records to be maintained for the holding period as defined in section 162C. 59. The Netstar telematics system 'FBT Logbook Report' will provide odometer records for the period of the year in which the system is used. Therefore, where the system is used continuously for the whole of the period of the year for which the car is held, the report will provide the odometer records for the holding period. 60. However, if the system is not continuously used for the whole of the period of the year for which the car is held, the reports will not provide both the start and end odometer readings for the holding period. For example, if the car is held for the full year but the Netstar telematics system 'FBT Logbook Report' is only used for the first 12 weeks of the year, the reports will only provide the odometer reading as at the start of the holding period. The reports will not provide the odometer reading for the end of the year (the end of the holding period). Therefore, in such a situation, the odometer reading at the end of the period will need to be separately recorded for the reports to provide odometer records for the holding period. | Does the Netstar telematics system 'FBT Logbook Report' meet the relevant requirements of section 10B?: 61. Section 10B states: NO REDUCTION OF OPERATING COST IN A NON-LOG BOOK YEAR OF TAX UNLESS LOG BOOK RECORDS AND ODOMETER RECORDS ARE MAINTAINED IN LOG BOOK YEAR OF TAX 62. Where the Netstar GPS Tracking System is used continuously for the whole of the holding period, the FBT Logbook Report will meet all the necessary requirements of section 10B in a non-logbook year of tax as: 63. An employer in a non-logbook year of tax who does not use the Netstar telematics system 'FBT Logbook Report' in that year of tax or does not use it for the whole of the period that the car is held but has used the system in one of the previous four FBT years continuously for an 'applicable log book period', will not by itself satisfy the requirements of section 10B. The employer will also need to: © AUSTRALIAN TAXATION OFFICE FOR THE COMMONWEALTH OF AUSTRALIA You are free to copy, adapt, modify, transmit and distribute this material as you wish (but not in any way that suggests the ATO or the Commonwealth endorses you or any of your services or products). Not previously issued as a draft


What this Ruling is about | If this Ruling applies to you, and you correctly rely on it, we will apply the law to you in the way set out in this Ruling. That is, you will not pay any more tax or penalties or interest in respect of the matters covered by this Ruling. | Further, if we think that this Ruling disadvantages you, we may apply the law in a way that is more favourable to you. | are entered in the English language, at, or as soon as reasonably practicable after, the respective times to which those odometer readings relate.


Related rulings: CR 2017/76 TR 2006/10
Legislative references: ITAA 1997 FBTAA 1986 FBTAA 1986 10 FBTAA 1986 10A FBTAA 1986 10B FBTAA 1986 136 FBTAA 1986 136(1) FBTAA 1986 162C FBTAA 1986 162G FBTAA 1986 162G(1) FBTAA 1986 162G(1)(b) FBTAA 1986 162H FBTAA 1986 162H(1) FBTAA 1986 162K FBTAA 1986 162K(2)(b) FBTAA 1986 162L FBTAA 1986 162L(2)(b) TAA 1953
Other references: The Macquarie Dictionary, Macquarie Dictionary Publishers 2019, on-line edition, viewed 21 August 2019.