What is Luxury Car Tax (LCT)?
Luxury Car Tax (LCT) is a tax on cars with a GST-inclusive value above the LCT threshold at a rate of 33%.
LCT is paid by businesses that sell or import luxury cars (dealers), and also by individuals who import luxury cars.
LCT is paid based on the same period required for GST reporting, which in QuickBooks is usually the Business Activity Statement (BAS).
LCT is not determined by QuickBooks, so reportable amounts have to be determined manually.
For more information about LCT, please consult a tax professional and explore the ATO website links below:
Recording LCT in QuickBooks
When LCT is enabled in GST settings, QuickBooks will include LCT inside the BAS lodgement flow. Once your BAS has been marked as lodged, a Luxury Car Tax Liabilities account will be created in the Chart of Accounts to track all LCT amounts.
To include an LCT amount to be paid, input the amount under Luxury Car Tax amount during the Other taxes filing stage of your BAS.
Tick the I need to include a refund amount if you need to report a refund amount.
When your activity statement is lodged, QuickBooks will automatically write a journal entry against the Luxury Car Tax Liabilities payable and the ATO Clearing Account.