When using the logbook method, your claim for motor vehicle expenses is based on the business use percentage of the expenses for the vehicle and covers running costs (fuel, repairs, rego, insurance etc.), depreciation, loan interest, lease payments (where applicable).
In order to use this method, you MUST have completed a logbook for 12 consecutive weeks, this will determine the business use percentage of your vehicle. You need written evidence (such as receipts) for all expenses for the vehicle.
Your logbook must show:
- When the logbook period starts and ends, and the odometer readings at these times
- The total number of kilometres the car travelled during the logbook period
- The number of kilometres travelled for work/business purposes during the logbook period based on the journeys recorded for the period
- The business use percentage for the period.
Entries in the logbook for each trip must be made at the end of the journey (or as soon as possible afterwards) and show the:
- Date the journey began and ended (must include every trip, both business & personal).
- Odometer readings at the start and end of the journey
- Kilometres travelled on the journey
- Reason for the journey.
Your records must also show the make, model, engine capacity and registration number of the car.
How To Calculate Your Business Use Percentage
Once you have completed your 12 week logbook, you will be able to calculate the business use percentage for your vehicle.
To do this, divide your business use kilometres by your total kilometres, then multiply by 100.
As an example, if you have travelled 2,000 kilometres in total for the 12 week period, and 1,500 of these were for business related purposes, you would do the following calculation:
1,500 ÷ 2,000 × 100 = 75%
In this example, the business use percentage of your vehicle would be 75%. This means that you could claim 75% of your vehicle expenses for the financial year.
As long as the business use of your vehicle remains fairly consistent, your logbook is valid for five years.
NOTE THAT IN MOST CASES, TRAVEL FROM HOME TO WORK IS PRIVATE & NOT DEDUCTIBLE