Luxury car tax calculator Australia
Use our luxury car tax calculator to calculate the tax you'll need to pay on your luxury car in Australia in December 2023.
The luxury car tax (LCT) is applied on cars above a certain value and is paid by businesses that sell or import luxury cars and individuals who import them.
Use our calculator below to figure out the LCT that is included in the overall price of a car in Australia and calculate the LCT you will need to pay.
You need to pay
Luxury car tax rates and thresholds
The LCT changes depending on the year and fuel efficiency of the vehicle. It is charged at 33% of the amount that is above the LCT threshold. The table below shows the yearly threshold for both fuel-efficient and other vehicles.
|Financial year||Fuel-efficient vehicles (fuel consumption of 7L/100km or less)||Other vehicles|
How to calculate your luxury car tax
Calculating your LCT is relatively simple. To start, you need to determine the LCT value of the car, which includes what you paid for the car including GST, customs duties and any other costs at the time of the import. You then subtract the LCT threshold. You can check the threshold for the applicable year using the table above. Then use the following formula:
(LCT value - LCT threshold) x 10/11 x 33/100 = LCT amount
To see an example of how to use this formula, take a look at the example below.
Janice is looking to buy a luxury car to replace her old vehicle. She knows the price but wants to see how much the LCT payable on the vehicle will be.
The car she is looking to purchase is $88,000 including GST and she is planning on buying it in the 2020–21 financial year. It is a fuel-efficient car, which means the applicable LCT threshold is $77,565.
She uses the formula to determine her LCT: ($88,000 - $77,565) x 10/11 x 33/100 =
Does the luxury car tax only apply to luxury cars?
The LCT is specifically applied to imported vehicles over the LCT threshold. This has made the LCT a point of contention in Australia for some time now from both buyers and manufacturers, because strictly that means that it does not only apply to luxury cars. For example, some entry-level models such as Nissan Patrol wagons or the Toyota LandCruiser 200 series attract the tax. On the flip side, some traditionally luxury brand cars may avoid the tax altogether.
In the years since the tax was introduced, increased buying power has driven up Australia's demand for bigger and better cars. At the same time, cars that may have previously been considered "luxury" have also become more accessible.
What about electric vehicles?
Electric, zero-emission vehicles are charged at the same level of tax as fuel-efficient vehicles ($77,565). This raises some issues from the electric vehicle industry, especially as "fuel-efficient" includes cars that consume up to 7 litres of petrol for every 100km.
While brands like Tesla may be deemed "luxury" in terms of price, many of the features do not meet those of luxury vehicles. Some people argue that taxing zero-emission vehicles like Teslas disincentives people from purchasing these cars and reducing their carbon footprint.
Are there any exemptions to the luxury car tax?
There are a few exemptions to the LCT:
- Commercial vehicles. Commercial vehicles designed to carry goods rather than passengers are not subject to the LCT, which can spare some high-end utes. The exemption is based on the vehicle's payload over the passenger-carrying capacity.
- Modifications for disabilities. If the car in question is under the LCT threshold, but modifications to the car for a person with a disability (e.g. hand controls) bring the price over the threshold, then the buyer will not be subject to the LCT. However, if the price of the car is above the threshold, then LCT will apply.
- Disability exemptions. If you are an eligible veteran or person with a disability, you may be exempt from LCT if the car in question is specifically fitted out for transporting a person with a disability seated in a wheelchair. However, if the car is GST-free under GST law, then LCT will apply.
Frequently asked questions
I've already paid LCT on my vehicle and I'm selling my car. Do I need to pay it again?
If the vehicle you're selling is less than two years old and the car has already been subject to LCT, you may need to pay it again if the car has increased in value. The LCT payable will decrease by the amount you previously paid.
I'm purchasing a vehicle that was imported one and a half years ago. Do I still need to pay LCT?
Yes. LCT is only waived for vehicles imported two or more years ago.
I want to start a business selling luxury cars. What do I need to do in regard to LCT?
Before paying for LCT, you need to be registered for GST and LCT. Your GST registration needs to be processed before registering for LCT.
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