ATO Cents-per-km Rate History
The ATO reviews its cents-per-km rate annually and announces changes for the new financial year (which begins 1 July). The rate has trended up steadily since 2023 in response to fuel and vehicle cost inflation. The 5,000 km cap has not changed.
Year-over-year rates
2025-26: 88¢ per km, capped at 5,000 km.
2024-25: 85¢ per km, capped at 5,000 km.
2023-24: 78¢ per km, capped at 5,000 km.
Rate effective from the start of each financial year (1 July).
Why the cap has not moved
The 5,000 km cap was set as a simplicity threshold rather than a cost ceiling. The ATO's view is that drivers exceeding 5,000 business km per year should reasonably be able to maintain a 12-week logbook, which is what the logbook method requires. Reviewing the cap would conflict with that simplification rationale.
FAQ
Will the rate go up again in 2026-27?
The 2026-27 cents-per-km rate will be announced before 1 July 2026. Year-over-year increases of 3 to 7 cents per kilometre have been the recent pattern, but inflation cooled in 2025 so a smaller bump is plausible.
Has the cap ever changed?
Not in recent memory. The 5,000 km cap has been the standard for decades, predating the cents-per-km rate's recent step-ups.
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