Document ID: chunk:federal_register_of_legislation:C2025C00120:section:10:p1
Version: federal_register_of_legislation:C2025C00120
Segment Type: section
Provision Reference: s 10 (pt 1/5)
Character Range: 50573–53062

10  Taxable value of car fringe benefits—cost basis
 (1) An employer may, in relation to a particular car, elect that this section apply in relation to all the car fringe benefits in relation to the employer in relation to a year of tax that relate to that car.
 (2) Subject to this Part, where an election is made under subsection (1), the taxable value, or the aggregate of the taxable values, as the case requires, of the car fringe benefits in relation to the employer in relation to the year of tax that relate to the car while it was held by a particular person (in this section referred to as the provider) during a particular period (in this section referred to as the holding period) in the year of tax is the amount calculated in accordance with the formula:

where:
C is the operating cost of the car during the holding period;
BP is:
 (a) if, under section 10A or 10B, the employer is not entitled to a reduction in the operating cost of the car on account of business journeys undertaken in the car during the holding period—nil; or
 (c) in any other case—the business use percentage applicable to the car for the holding period; and
R is the amount (if any) of the recipient's payment.
 (3) For the purposes of subsection (2):
 (a) the operating cost of the car during the holding period is the sum of:
 (i) any car expenses (other than insured repair expenses or expenses in respect of registration and insurance) relating to the car incurred during the holding period (whether the expenses are incurred by the provider or by any other person), not including, in a case where the car is leased to the provider, any car expenses incurred by the lessor pursuant to the lease agreement; and
 (ii) so much of any expense paid or payable in respect of the registration of, or insurance in respect of, the car as is attributable to the holding period (whether the expenses are incurred by the provider or by any other person), not including:
 (A) in a case where the car is owned by the provider—any expense incurred before the provider became the owner of the car; or
 (B) in a case where the car is leased to the provider—any expense incurred by the lessor pursuant to the lease agreement; and
 (iii) in a case where the car is owned by the provider:
 (A) the amount of depreciation that is deemed to have been incurred by the provider in respect of the car in respect of the holding period; and
 (B) the amount of interest that is deemed to have been incurred by the provider