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Motor Vehicle Claim – Logbook Method

Do you use your car for work-related purposes? If so, you can claim a deduction in your Tax Return for this use assisting in reducing the amount of tax you are liable to pay.

There are two different methods available to calculate your work-related car expense, being the Logbook method and the Cents per Kilometre method. In this article we have focused on the Logbook method only.

The Logbook method allows you to calculate your deduction for work-related car use based on actual expenditure apportioned for work-related use via a logbook percentage of work-related kilometres travelled compared to total kilometres travelled over the same 12 continuous week period.

Keeping a logbook

When using the logbook method:

you can claim the business-use percentage of each car expense, based on the logbook records of your car’s usage

you must keep a logbook so you can work out the percentage

you must have written evidence of your fuel and oil costs, or odometer readings on which your estimates are based

you must have written evidence for all your other expenses

Getting a logbook

You can use pre-printed logbooks available from stationery suppliers or make your own.

Valid for five years

Each logbook you keep is valid for five years, but you may start a new logbook at any time. If your travel situation varies significantly since your last logbook, a new logbook should be kept to reflect your new travel situation.

If you establish your business-use percentage using a logbook from an earlier year, you must keep that logbook and maintain odometer readings in the following years.

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Your first year

If this is the first year you have used the logbook method, you must keep a logbook during the income tax year for at least 12 continuous weeks. That 12-week period needs to be representative of your travel throughout the year.

If you started to use your car for business purposes less than 12 weeks before the end of the income year, you can continue to keep a logbook into the next year so it covers the required 12 weeks.

Two or more cars

If you want to use the logbook method for two or more cars, the logbook for each car must cover the same period. The 12-week period you choose should be representative of the business use of all cars.

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Information your logbook must contain

Each logbook you keep must contain the following information:

when the logbook period begins and ends

the car’s odometer readings at the start and end of the logbook period

the total number of kilometres the car travelled during the logbook period

the number of kilometres travelled for each journey recorded in the logbook (if you made two or more journeys in a row on the same day, you can record them as a single journey). You will need to record the following:

start and finishing times of the journey

odometer readings at the start and end of the journey

kilometres travelled for the journey

reason for the journey

the business-use percentage for the logbook period

the odometer readings at the start and end of each income year you use the logbook method