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Changes to the 2023-2024 IRD kilometre rates

The IRD has announced the kilometre rates, also referred to as mileage rates, for the 2023-2024 income year.  The rates are $1.04 for petrol, diesel, hybrid and electric vehicles for up to 14,000 km.  After 14,000 km, the rates are $0.35 for diesel and petrol vehicles, $0.21 for hybrid vehicles, and $0.12 for electric vehicles. The rates set out below apply for the 2023-2024 income year for business motor vehicle expenditure claims. 

Vehicle typeTier 1 rates (up to 14,000 km)Tier 12rates (over 14,000 km)
Petrol or diesel$1.04$0.35
Petrol hybrid$1.04$0.21

The rates have increased for all vehicle types in both Tier 1 and Tier 2 in light of changing fuel and car maintenance costs.

The IRD has a history of revising the kilometre rates and changing them every year.  Since 2017, the Tier 1 rates have increased by at least two cents per kilometre every year.  However, Tier 2 rates actually decreased in the 2019-2020 and 2020-2021 income years and again went up for the 2021-2022 and 2022-2023 income years due to the high fuel prices.

This year, the IRD has increased the rate for the first 14,000 km by 9 cents, the biggest increase so far.  All rates for kilometres over 14,000 have increased by a cent.

Records you need to keep

You must keep a logbook of your business and personal driving to get Tier 1 reimbursement or deductions for the first 14,000 km (total).   If you don’t keep records of your driving, you can only claim Tier 1 rates for the first 3,500 km of business-related driving.


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