I have had my 1996 pajero from new, 11 years old this march.
Run my own business, and the vehicle is supplied through the business.
So I pay FBT.
Vehicles bought for $46,000.00 new, do 25,000k plus a year so pay 11%.
There is one deduction for a vehicle older than 6 years of 30%.
So I pay $46,000 x 11% x 70% = about $3,500.00 a year in FBT.
But my vehicle is now worth about $10,000 if I am lucky, maybe $8,000.00
Have decided to keep it for another 5 years, by then it will be worth maybe $5,000.00, and I will still be paying $3,500.00 a year, plus maintenance.
(The tax deductability of a lease / new car is not an issue, I have other tax deductions that solve any problem with a small profit.)
Can I get a revaluation on the car for FBT?
Or do I need to sell it, and maybe buy it back for that to happen?
My accountant says the tax office may disregard a sell/buyback and declare it a tax dodge.
Has anyone done this? Any ideas?
PS - reason I am keeping it is the $5,000 odd of extras I have fitted (worth nothing on a trade in) and the body is still pretty good, just needs an new engine in a year or two for another 400,000k.
And why should I pay tax for owning a car through a business?
The dollars don't add up buying a new business vehicle, rather put the money into other investments that make money.