Tracking Your Vehicle Kilometers

Before you record mileage, you need to know that vehicle write offs are “bigger” than just recording your mileage, and there are different ways to record mileage or vehicle expense. First you need to determine HOW you are writing off your vehicle.

Are you writing off the vehicle & the expenses?
Are you writing off the kilometers?
Maybe you are doing a combination of both?
How many vehicles are you writing off?
What is the right amount you can write off?
What about taxable benefits? When do those apply?

You can see that vehicle expenses are a much bigger topic than just tracking mileage. Make sure you are talking to your qualified bookkeeper to ensure you are taking the right write offs, and the right amounts!

Information on tracking mileage

Below is an example of a vehicle log that contains the information required to support a claim for use of a vehicle. This vehicle log has been provided for your convenience. It does not replace the need to retain all records that pertain to the operation of the vehicle.

This is how to complete the log: (refer to the attached example)

Record the name and address of the vehicle owner and, if applicable, the Business Number or the GST registration number.

Record the make and year of the vehicle.

Begin a new page for each month of the log.

For each trip during the month, record:

  • The date of the trip and the odometer reading at the beginning of the trip.
  • The point of origin (place trip began), a description of the trip, and the nature of the goods/services involved.
  • The odometer reading at the end of the trip and how many kilometers were driven.
  • Allocate on a reasonable basis the amount of kilometers driven for business use and amount for non-business use. Combined trips for personal and business use require an allocation be made since it is not entirely business use.

At the end of the month complete the summary section as follows:

  • Record the vehicle odometer reading at the end of the month in space ‘A’.
  • Subtract ‘B’ from ‘A’ to get the total kilometers driven and record this amount in space ‘C’.
  • Add total distance traveled for business from column “Bus. KM’ and enter in space ‘D’.
  • Multiply space ‘D’ by 100 and divide this total by the total in space ‘C’ to get the percentage of business use for the vehicle. Record this amount in space ‘E’.

Please maintain the mileage log on an ongoing basis. The mileage log may be used to determine if the vehicle is still being used in commercial activity and to support any future expenses claimed regarding the vehicle.

Mileage rates for CRA are here:

http://www.cra-arc.gc.ca/tx/bsnss/tpcs/pyrll/bnfts/tmbl/llwnc/rts-eng.html

Mileage-Log-Sample.xls