Your client, Deepak, has a small business as an independent architect. He has purchased a new car as a family sedan in order to visit client premises and building sites. Deepak purchased the car on 1 January 2021 for $28,000. The car has a non-rotary engine and an engine capacity of 2000cc. The car was purchased via a loan at a flat 7.5% interest rate. The car has an estimated life of five years. Deepak kept meticulous log books and records for the vehicle that reveal the following:

 • total kilometers travelled 22,000;

 • business kilometers 7000;

 • registration and insurance $3400; and

 • fuel, oil, and servicing costs $4200.

 Required: Calculate Deepak's deduction for his car using the four methods available to him. Which method should Deepak adopt for the year ending 30 June 2021?

Answer rating: 100% (QA)

Deepak can calculate his car expenses deduction using four different methods the Cents per Kilometer Method the 12 of Original Value Method the OneThi... View the full answer