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AndyP3(Newbie)Newbie
8 June 2023

I purchased my car in 2021. I use it for 80+ percent work use as I’m in sales. It was stolen in March, and hasn’t been recovered - it has been declared a write off. My insurer replaced the vehicle with a brand new one that they purchased from a dealership. The brand new vehicle is the same Make and Model, however due to covid car prices, it was more expensive than the one I purchased initially.


How do I calculate depreciation on the stolen vehicle given it no longer exists and has been disposed of without a cash value, and can I claim depreciation on the new vehicle if I didn’t purchase it but am the owner.

2,559 views
2 replies
2,559 views
2 replies

Most helpful response

Most helpful reply

AriATO(Community Support)Community Support
12 June 2023

Hi @AndyP3


You'll need to do a balancing adjustment for your old car. Did you claim depreciation for it?


You need to compare the adjustable value to the termination value. The AV is the cost of the old car minus any depreciation deductions you claimed. The termination value of your old car is the value of your insurance payout.


You mentioned car prices have increased so is the insurance payout more than your old cars adjustable value? The difference would be income but since you're replacing an asset you might be able to offset this against the cost of the new car.


There's a few pieces of info you should read through about this. Can you take a look at our website under ceasing to use a depreciating asset to see if it all makes sense?

All replies

Most helpful reply

AriATO(Community Support)Community Support
12 June 2023

Hi @AndyP3


You'll need to do a balancing adjustment for your old car. Did you claim depreciation for it?


You need to compare the adjustable value to the termination value. The AV is the cost of the old car minus any depreciation deductions you claimed. The termination value of your old car is the value of your insurance payout.


You mentioned car prices have increased so is the insurance payout more than your old cars adjustable value? The difference would be income but since you're replacing an asset you might be able to offset this against the cost of the new car.


There's a few pieces of info you should read through about this. Can you take a look at our website under ceasing to use a depreciating asset to see if it all makes sense?

AndyP3(Newbie)Newbie
12 June 2023

Hi Ari,

Thanks for the reply.


My issue here is that I didn’t receive a payout from my insurance at all. I have received zero funds for them.


As per the terms of my policy, I was eligible for a replacement vehicle free of charge that they sourced and provided. I had nothing to do with this process at all.


I am wondering how the adjustment works in this case as my old vehicle was written off, yet no funds were received and I don’t have a value for the vehicle which was paid.



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I use my car for work. It was stolen in March, and my insurance replaced it with a brand new vehicle | ATO Community