The Wife Is A Genius

[bs888]

  Isher said:

  richdave said:

I am quite sure that if I "repair" my ECU or exhaust and have a tax invoice to that effect I will have no problems....we'll see I guess.

Barry: I suspect that is what BS888 has done.

[hammer007]

  Isher said:

  richdave said:

I am quite sure that if I "repair" my ECU or exhaust and have a tax invoice to that effect I will have no problems....we'll see I guess.

I think that's the only way you could get it done. By getting your mechanic to invoice you for some legit maintance while actually carrying out something else like an up-grade or mod.

Barry: I suspect that is what BS888 has done.

Basically you are relaying on the ignorance of the lease company and informing them that your mod was a legitimate 'service'.

It don't worry me but it is still not 'free'. Either way you will be contirbuiting to the cost as part of your salary package contribution. If you allocated $9000 pa to running costs (as caculated by you depending on the number of km's you travel pa..) and you spend $4000 on mods (invoiced as legit maint to get teh salary package company to pay you back..) you will still need to make up the difference at some stage if your running costs excede the $5000 pa remianing in the kitty for legitimate expences.

Regards,

Isher

Another view:

If you are using the Employee Contribution Method your contribution to the running costs post tax is equivalent to the FBT value of the car - not the actual running costs of the car.

For example my monthly contributions for a fully maintained XR6T is around $1636 or $755 per fortnight. The FBT value of the car is $45357 and using the 11% useage factor (25K- 40K pa) the FBT payable is $4989 pa or $191 per fortnight.

Running costs are higher than this (rego / insurance / petrol / maintenace / tyres).

Consequently running costs come out of both pre and post tax contributions.

Bottom line - any additional upgrades if you can get them paid out of pre-tax and you are on the top marginal tax rate are half price

Much as I love all this upgrades and numbers stuff (particuarily the Kw figures APS and others are getting) my head keeps telling me

1) The car is awesome stock (more than 45% power than what last parked in my garage)

2) Its not really my car ie leased for 3 years

3) I got a bit of negative feedback when selling my EF XR6 because of the aftermarket airbox and sports exhaust

My heart tells me:

1) There has to be room for an exhaust and filter upgrade but a bit more subtle than previous efforts

[Cam]

  Isher said:

I think that's the only way you could get it done. By getting your mechanic to invoice you for some legit maintance while actually carrying out something else like an up-grade or mod.

Lets not fool ourselves - now were talking fraud.

Our (ridiculous) tax system essentially works on the honor system. Claim whatever you like and you will get the money back. But get audited and then your in trouble.

A lot of people forget it doesnt matter if they think something is acceptable under the legislation (or can come up with a good excuse how it may be possible to misunderstand) it is what the ATO think that's important.

One other think: the ATOs responsibility is to extract the maximum possible amount of money in taxes with the current legislation, so if there is any possible misinterpretation you can be sure which way they will think it should be.

(No I dont work for the ATO - and I think the tax system is as ridiculous as the next person)

[richdave]

  hammer007 said:

Another view:

If you are using the Employee Contribution Method your contribution to the running costs post tax is equivalent to the FBT value of the car - not the actual running costs of the car.

For example my monthly contributions for a fully maintained XR6T is around $1636 or $755 per fortnight. The FBT value of the car is $45357 and using the 11% useage factor (25K- 40K pa) the FBT payable is $4989 pa or $191 per fortnight.

Running costs are higher than this (rego / insurance / petrol / maintenace / tyres).

Consequently running costs come out of both pre and post tax contributions.

Bottom line - any additional upgrades if you can get them paid out of pre-tax and you are on the top marginal tax rate are half price

Thanks Hammer007, you are spot on there and saved me a lengthy explanation. As for my first post, it was technically incorrect since the upgrades would not be completely free but effectively half price since they are paid from pre tax money as you correctly point out.