Close-Company Motor Vehicle Private-use Adjustment

The Inland Revenue Department has published a new rule for the Close-Company motor vehicle used by shareholder-employees. According to the new rule, the company needs to keep a travel logbook for the continuous three months to work out the percentage of private use, then use the percentage to make motor vehicle expense private adjustments. This logbook percentage can be used for three years.

To comply with this rule, I suggest all directors/shareholders of a company prepare a logbook and provide the private use % in the 2024 Business Annual Checklist. The old rule of “Days for private use” is no longer applicable.

If you have problems working out the taxable value of a motor vehicle or have questions about record keeling for a motor vehicle. You can contact us for a consultation.