Luxury Advice

It’s not breaking news that Australians are buying cars in record numbers, but the kind of cars we’re buying may surprise you because it seems to suggest many of us have too much money.

There are any number of ways to define a luxury car - or indeed the term 'luxury' itself, which means different things to different people, possibly based on how much of it they’ve personally enjoyed.

Luxury cars have been a part of the car industry since the very beginning.

A luxury car can be defined in many ways. For some it’s a car that has a higher level of equipment, comfort and/or performance than an average car.

Few brands have had the kind of immediate impact on the car industry as Tesla. The American brand has been a catalyst for the mainstream adoption of electric vehicles and become one of the most popular carmakers in the world, in a remarkably short period of time.

The New Vehicle Emissions Standards (NVES) is the most controversial topic in the car industry in 2024, and it’s likely to remain that way for the foreseeable future.

Luxury Car Tax Loophole in Australia.The Luxury Car Tax is one of the most controversial topics in the car industry, and has been since it was introduced way back in 2000. It is, in simple terms, an additional tax that car buyers are forced to pay when they purchase a new vehicle over a price point the government, or at least someone at the ATO, deems is a luxury.At the time of publication (early 2024), the current 2023-24 threshold is set at $76,950 and $89,332 for fuel efficient vehicles - which is any vehicle that uses less than 7.0 litres per 100km. The LCT means you pay an extra 33 per cent of the value of the vehicle above the threshold amount.This means anyone buying a new car above the LCT threshold is paying an additional tax on top of the other government charges for a new vehicle, which already include GST and stamp duty.People who buy luxury yachts or luxury helicopters, luxury watches or luxury luxuries do not pay a luxury tax on those things. Strange.Naturally, as with most taxes, people are curious if there is a luxury car tax loophole and often ask how to avoid luxury car tax in Australia. Sadly, and in order not to ruffle any feathers at the ATO, we have to report there are not any easy, obvious and legal loopholes to avoid paying the LCT. And if there were I might be in trouble for knowing about them.In the past, however, there have been some, shall we say, questionable practices from some dealers, who would reportedly get the LCT refunded from the ATO and then re-sell that car without including the LCT. However, the ATO cracked down on this behaviour back in 2021.One possible loophole that remains is that the LCT only applies to cars that are two years old or newer, so if the car sits on the showroom floor for more than two years, in theory you can avoid paying the LCT as it is no longer considered a ‘new’ car. However, this does require owning a car dealership, or being prepared to wait two years for a car to sit on a dealer lot - which is unlikely to happen by accident.Yes, it’s quite easy. You just need to buy a car under the threshold and you will avoid paying any LCT.Unfortunately for those looking to save money on their tax bill the government and ATO have been quite clever in the way it they have implemented the LCT. It simply adds the additional tax to any and all vehicles above the threshold, which makes cheating the system nearly impossible.Ultimately, that means plenty of new vehicles not traditionally considered ‘luxury’ are hit with the LCT, which includes the likes of the Toyota LandCruiser, Hyundai Palisade and Ford Ranger.If those cars are luxury, I'm a helicopter.

Speed equals money - check out the list of the most expensive Bugatti cars ever sold...

Unlike some brands which have several vintage cars that have fetched very similar prices at different times, there’s absolutely no doubt what the most expensive model for the German brand is.

One of the most controversial taxes the Australian Government has enacted. Theoretically, it’s designed to raise more revenue to pay for road infrastructure funding by adding an additional tax on new vehicles the government deems as ‘luxurious.’