Tax for Driving Instructors Australia
This page is for driving instructors who want a clearer starting point on common deductions, including dual-control vehicle costs, licensing fees, first aid training, and ABN/GST obligations.
Quick answer: driving instructors can often claim significant vehicle-related expenses since the car is central to earning income. Fuel, insurance, registration, depreciation, and maintenance of a dual-control vehicle are commonly deductible to the extent they relate to work. Most driving instructors operate as sole traders, so ABN and potentially GST obligations apply. The ATO expects proper records, especially a vehicle logbook.
Common driving instructor deductions
Often deductible
- Dual-control vehicle running costs: fuel, oil, tyres, servicing, and repairs (work portion)
- Vehicle insurance, registration, and roadside assistance (work portion)
- Depreciation on the dual-control vehicle (work portion)
- Dual-control modification and installation costs (depreciated or deducted depending on cost)
- Instructor licence renewal fees
- First aid and CPR training required for licensing
- Phone and data costs with a work-related portion and records
- Public liability insurance premiums
Often non-deductible
- Private use of the dual-control vehicle (must be apportioned out)
- Fines and penalties (including traffic fines incurred during lessons)
- Initial instructor licence costs to enter the profession (may be capital)
- Meals unless travelling overnight for work
- Ordinary clothing worn during lessons
Vehicle costs and ABN obligations
- Vehicle logbook: keep a logbook for at least 12 continuous weeks to establish your work-use percentage. The work portion of all vehicle expenses is then deductible.
- Depreciation: the dual-control vehicle itself is a depreciating asset. The ATO car cost limit applies if the vehicle cost exceeds the threshold.
- ABN obligations: most driving instructors are sole traders and need an ABN. You report business income and claim business expenses in your tax return.
- GST registration: mandatory once annual turnover reaches $75,000. Below that threshold, registration is optional.
Records driving instructors should keep
- Vehicle logbook showing work-related kilometres, lesson times, and student pickup locations
- Receipts for fuel, servicing, insurance, registration, and vehicle repairs
- Licence renewal receipts and first aid training certificates
- Insurance policy documents and premium receipts
- Phone and data usage records where a work portion is claimed
Start with these calculators
Tax return calculator
Estimate the refund impact of your eligible work-related deductions.
GST calculator
Work out GST-inclusive and GST-exclusive amounts for invoicing.
Pay calculator
Check take-home pay for weekly, fortnightly, monthly, or annual salary.
Salary sacrifice calculator
Model concessional super contributions against take-home pay.
Driving instructor tax FAQs
Can driving instructors claim dual-control vehicle costs?
Generally yes for the work-related portion. Fuel, insurance, registration, depreciation, and maintenance are deductible based on your logbook work-use percentage. Private use must be excluded.
Can driving instructors claim licensing fees?
Annual licence renewal fees are generally deductible. The initial licence cost to enter the profession may be treated as a capital expense depending on your circumstances.
Do driving instructors need an ABN?
Most driving instructors operate as sole traders and need an ABN. GST registration is mandatory once annual turnover reaches $75,000; below that threshold it is optional.
Tax Accuracy & Sources
This guide summarises common driving instructor deduction patterns only. Always check whether the expense was reimbursed, whether any private element needs apportionment, and whether the vehicle or licence claim meets ATO requirements.
Uses 2025-26 ATO rates.