2011 review of the Commissioner's mileage rate for expenditure incurred for the business use of a motor vehicle

The Operational Statement (OS) 09/01 published in the Tax Information Bulletin Volume 21, Number 3 (May 2009) provides the Commissioner's statement of a mileage rate for expenditure incurred for the business use of a motor vehicle. OS 09/01 can also be viewed on our website.

Inland Revenue has reviewed the motor vehicle mileage rate reflecting on the average cost of running a motor vehicle, including the average fuel prices for the 2011 income year, and has amended the current mileage rate to 74 cents per kilometre which is to apply to both petrol and diesel fuel vehicles.

Inland Revenue will continue to monitor fuel prices and publish a rate at least once a year.

Taxpayers are not obliged to use the Commissioner's mileage rate. They may use actual costs if they consider that the Commissioner's mileage rate does not reflect their true costs.

It is accepted that employers may use the motor vehicle running cost data published by other reputable sources, for example the New Zealand Automobile Association Incorporated, as an alternative reasonable estimate for reimbursement of employees.

The mileage rate does not apply in respect of motor cycles.