3 Tips for Properly Logging Your Car Use for Claiming Purposes - What to Know
So, your business is utilizing cars to carry out your job. Did you know that you can claim the expenses that are related to it? For each car you want to claim from, you will need to set up a system to log different data for its purpose. Otherwise, you might not be claiming as much as you actually can, or you might be ineligible for a claim.
Here is how you can adequately log your work-related car use for claiming purposes:
1. Note down the timeframe
When it comes to logging data in your logbook, if this is your first time using it, you will need at least 12 continuous weeks of using it. This means that, whenever you start, whether it be in the beginning or even the end of a year, you need to have 12-weeks' worth of logs that will represent your car usage business-wise.
With that done, each logbook you keep will be valid for approximately five years. However, you are free to start as many logbooks as you want. For example, when you purchase three new cars back to back for business use, you can begin three logbooks right away. Also, do note that if your car usage changes due for any reason, the logbook will need to be changed as well. This will most likely occur when you are changing business, affecting how you end up using the cars to assist with your tasks.
2. Record the right data
What kind of data do you need to be recording in your logbook? Well, quite a lot. For each car that is going to be used for a business purpose, you are going to need to record the following (all of which will be during your logbook period which should be stated with a start and end date):
Car's odometer readings at the beginning and end
Total distance traveled
Distance traveled for each journey (same day can be combined to one)
Car model, registration, engine capacity
Reason of travel (description of business)
While you can record a lot more in your logbook, the above is the most essential information.
3. Keep other relevant data
Other than keeping a logbook to note down the distance traveled during a specific period, there are many other records you need to keep. For example, you will need physical evidence for fuel costs and even odometer readings to help you estimate fuel usage.
With that, you will be able to claim all sorts of things from your car. For example, if you manage to hold onto your fuel usage data, you can claim fuel and oil. Also, there are many things you can claim if you have evidence, such as car wash, insurance, repairs, servicing, and so on.
As you can see, if you have got a fleet of cars to help assist with your business, fortunately, they will all be claimable. However, if you are doing all of this by yourself, it can be a lot of tedious work. As such, we highly recommend that you work with a bookkeeper or an accountant to help you keep track of these costs, allowing you to successfully claim for each car you wish to claim from.
Are you looking for business accountants to work with at the Gold Coast? Head on to our website and get started!