Valuing the private use of a vehicle

Councils may decide whether or not a car is to be supplied for the Mayor or Chair and on what basis. The determinant is what is most cost effective for the Council and ratepayers.

The Authority has set a benchmark of 41% of the price of a new car (including GST) as the value of the benefit in terms of gross remuneration.

In valuing a vehicle:

  • “Mayor/Chair use only” means the car can be used by other officers, can be driven home and garaged by the mayor/chair but does not permit any private use.
  • “Full private use” of a car means exclusive use by the mayor/chair, including for any private travel.
  • Full private use is assessed by the Authority at 20% of the use of the car.
  • If a larger or smaller private usage is claimed, supporting information is required (i.e. a log book).
  • For either Mayor/Chair use only or full private use, all vehicle insurance, maintenance, repair and running costs incurred, including fuel, shall be met by the council.

The following example shows the calculation that would be undertaken on a car valued at $38,000 inc. GST, which is available for the full private use of the mayor/chair:

$38,000 x 41% x 20% = $3116

The amount of $3116 is to be deducted from the salary o the mayor/chair.