Motor Vehicle Reimbursement Rates For Business Use
A clear guide to New Zealand motor vehicle kilometre rates, business mileage reimbursement, employee vehicle reimbursement, and vehicle expense claims for petrol, diesel, petrol hybrid, and electric vehicles.
2025–2026 Income Year
Use The Right Rate For The Right Vehicle.
Inland Revenue now publishes separate kilometre rates for petrol, diesel, petrol hybrid, and electric vehicles. The correct rate depends on the income year, vehicle type, and whether travel falls into Tier 1 or Tier 2.
Current Vehicle Reimbursement Rates Made Simple
These 2025–2026 kilometre rates apply when using the kilometre rate method for business use of a vehicle. Tier 1 covers fixed and running costs, while Tier 2 covers running costs only.
Petrol
Diesel
Petrol Hybrid
Electric
Estimate Your Motor Vehicle Reimbursement
Select the income year and vehicle type, then enter the business kilometres that fall under Tier 1 and Tier 2. This gives a simple estimate before speaking with Guardian Accounting.
Calculate Vehicle Reimbursement
Use this simple calculator for a quick estimate using Inland Revenue kilometre rates.
Based on 5,000 Tier 1 business kilometres for a petrol vehicle in the 2025–2026 income year.
Compare Current And Previous Kilometre Rates
These tables make it easy to compare the latest 2025–2026 kilometre rates with the previous 2024–2025 income year rates.
Current Rates
2025–2026 Income Year
Previous Rates
2024–2025 Income Year
Understanding Tier 1 And Tier 2 Vehicle Rates
The kilometre rate method can be useful, but it is important to understand which rate applies and what records may be needed.
Choose The Correct Vehicle Type
Petrol, diesel, petrol hybrid, and electric vehicles now have different kilometre rates. Selecting the correct vehicle type helps avoid using the wrong reimbursement rate.
Separate Tier 1 And Tier 2 Travel
Tier 1 applies to the business portion of the first 14,000 kilometres travelled by the vehicle in the income year. Tier 2 applies after that point.
Keep Clear Business Records
Vehicle claims and reimbursements should be supported by reliable records, such as business travel details, logbook information, and evidence of business use.
Motor Vehicle Reimbursement Guidance For New Zealand Businesses
Motor vehicle reimbursement rates are important for employees, sole traders, contractors, companies, and small business owners who use a personal or business vehicle for work-related travel. Using the correct kilometre rate can help support clearer record keeping, more accurate reimbursement, and better business expense planning.
Guardian Accounting helps clients understand how New Zealand kilometre rates apply to business vehicle use, employee reimbursements, self-employed vehicle expense claims, GST considerations, and year-end tax records. The correct treatment can depend on the vehicle type, income year, business kilometres travelled, private use, logbook records, and whether the kilometre rate method or actual cost method is more suitable.
Based in Howick, Guardian Accounting supports individuals, sole traders, rental property owners, trusts, companies, and small businesses across East Auckland, wider Auckland, North Auckland, and New Zealand with practical accounting, tax, and business advisory support.
Helpful Client Resources
Explore related Guardian Accounting resources for tax dates, tax rates, and business accounting support.
Common Questions About Vehicle Rates
These answers help visitors understand kilometre rates, reimbursement, business vehicle claims, and when to get accounting advice.
Need Help With Vehicle Reimbursement Or Business Expenses?
Talk to Guardian Accounting about motor vehicle reimbursement, business mileage claims, employee reimbursements, GST, record keeping, and tax planning.
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