There will be an increase in the Luxury Car Tax (LCT) threshold limit for the 2017-18 financial year. The LCT is a tax of 33% imposed on luxury cars over the luxury car tax threshold, which is indexed annually. LCT is generally payable when a car is sold or imported at the retail level. It is in addition to any goods and services tax (GST) payable.
As of 1st July 2017:
– LCT Threshold $65,094 will become effective (increased from $64,132)
– Fuel efficient vehicle (FEV) limit will be $75,526 (remains unchanged)
To work out the amount of this tax (LCT) you must pay if you import a car, use the following formula:
(LCT value – LCT threshold) x 10/11 x 33%
The LCT value of an imported car includes:
– The customs value (as worked out under the Customs Act) of the car and any parts, accessories or attachments imported at the same time as the car and can reasonably be expected to be fitted to the car (add-ons)
– Amounts not already included in the customs value for the international transport of the car and add-ons to Australia
– The amount not already included in the customs value for the insurance of the car and add-ons to be transported to Australia
– Any customs duty payable on the importation of the car and add-ons
– Any GST payable on the importation of the car and add-ons
– If the importation of the car is GST-free, an amount equal to the amount of GST that would otherwise have been payable.
You’ll need to pay the amount of LCT due on the car, along with any customs duty payable, to the Department of Immigration and Border Protection as part of the customs clearance process – this is normally done through your licenced Customs Broker. Call us here at Colless Young for more information and assistance.
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Source reference: https://www.ato.gov.au/Business/Luxury-car-tax/
