Electric vehicles are now common enough on Australian roads that most EV owners are asking the same question at tax time: what am I actually allowed to claim? The good news is the ATO treats an EV or plug-in hybrid exactly like a petrol car for work-related expense purposes — the same two claim methods apply. The only real difference is how you account for “fuel”, since your fuel is electricity.

Here's a plain-English rundown of what you can claim on your 2025–26 return, what you can't, and the records you'll need.

Step one: is your EV actually a “car” for tax purposes?

Yes — for tax purposes, a car is any motor vehicle designed to carry a load under one tonne and fewer than 9 passengers. This includes battery EVs, plug-in hybrids and regular hybrids, as long as they meet that definition. A handful of larger electric utes and vans may fall outside the “car” definition and follow different rules — talk to us if you're not sure which applies to you.

Method 1: Cents per kilometre

This is the simplest option. For 2025–26, the rate is 88 cents per kilometre, and you can claim up to 5,000 work-related kilometres per car — a maximum deduction of $4,400.

• No receipts required, but you must be able to show how you calculated your work kilometres (a diary, calendar or trip log is fine)
• The 88c rate already bundles in electricity, depreciation, insurance, registration and servicing
• You cannot add your home charging or public charging costs on top of this rate — it's an all-in figure

Method 2: Logbook method

If you drive more than 5,000 work kilometres a year, the logbook method usually delivers a bigger deduction. You keep a 12-week logbook to establish your business-use percentage, then apply that percentage to your actual running costs — including your electricity costs.

Home charging

For the 2025–26 income year, the ATO's home-charging shortcut rate is 4.20 cents per kilometre. Multiply this by your total (not just work) kilometres to estimate your electricity cost, then apply your business-use percentage from your logbook. Keep at least one electricity bill on file to show you genuinely incur home charging costs.

Note: this rate is increasing to 5.47 cents per kilometre, but only from 1 July 2026 (for the 2026–27 year). If you're finalising your 2025–26 return now, use the current 4.20c rate — see our earlier article on the upcoming increase for what changes next year.

Public charging

Amounts paid at public chargers (Chargefox, Evie, Tesla Supercharger and similar) are a straightforward fuel cost. Keep your receipts or app payment history and claim the business-use percentage, the same as you would for petrol.

Other running costs

• Registration and insurance (business-use percentage)
• Servicing, tyres and repairs (business-use percentage)
• Depreciation on the vehicle, up to the car limit of $69,674 for 2025–26
• Interest on a car loan, if you financed the purchase (business-use percentage)

What you can't claim

• Private use of the vehicle — commuting between home and your normal workplace is not deductible
• Electricity or charging costs on top of the cents per kilometre rate — it's already included
• Running costs for a car you don't own or lease — if your EV is provided under a novated lease or salary packaging arrangement, your employer generally owns the deduction, not you. You can still claim work-related parking and tolls
• The capital cost of the car itself if you're using the cents per km method (depreciation is already built into the rate)

A quick worked example

Priya uses her own EV for work and keeps a 12-week logbook, showing 65% business use. Over the year she travels 20,000km in total.

Priya then adds her share of registration, insurance, servicing and depreciation to arrive at her total logbook-method deduction — which, for most regular work drivers, comes out well ahead of the $4,400 cap under the cents per km method.

If your EV is salary packaged or under a novated lease

Many eligible battery EVs remain exempt from Fringe Benefits Tax when provided through a novated lease or salary packaging arrangement, provided the vehicle is priced below the luxury car tax threshold ($91,387 for 2025–26). If this applies to you:

• You generally can't claim car running costs yourself, because you don't own or lease the car — your employer does
• The exempt fringe benefit still shows up as a reportable fringe benefits amount on your income statement, which can affect things like HECS repayments and the Medicare levy surcharge
• Plug-in hybrids no longer qualify for the FBT exemption on arrangements entered into from 1 April 2025 — only full battery EVs and hydrogen fuel cell vehicles do

Records checklist

• Odometer readings at the start and end of the income year
• A valid 12-week logbook, if using the logbook method (can cover up to 5 income years if your driving pattern hasn't changed)
• At least one electricity bill, to support your home charging claim
• Receipts or app records for any public charging
• Registration, insurance and servicing invoices
• A diary or trip log if using the cents per km method

Get it right this tax time

EV ownership doesn't change the fundamentals of claiming car expenses, but the electricity side trips a lot of people up — especially when it comes to combining home and public charging, or figuring out whether the cents per km cap or the logbook method gives the better result.

Talk to North Coast Accounting before you lodge — we'll help you choose the right method and make sure every eligible kilometre and dollar is captured.

Disclaimer: This article is general information only and does not constitute tax advice. It does not take into account your personal circumstances. Outcomes depend on your individual situation and current ATO rules, which may change. Please speak with North Coast Accounting before acting on anything in this article.