Blocked input tax – Passenger vehicles

A passenger vehicle is one that is:

1. used on public roads,
2. accommodates up to nine passengers, and,
3. weighs less than 3 tonnes when unladen.

Such vehicles are thought to be for private and not business use, and therefore GST on purchase of such vehicles is blocked, i.e. a business is not allowed to claim for credit on GST incurred.

The GST is categorized as Blocked Input tax, and the tax code for that is BL.

To be able to claim GST on purchases of vehicles, the following conditions must be met:

1. The vehicle must be registered under the business name
2. The business name or logo is displayed on the vehicle
3. The vehicle is kept at the business premises and is not used for private purposes.