• Home
  • About
  • Services
  • Resources
  • Shop
  • Contact
  • Modern Finance Club
  • Home
  • About
  • Services
  • Resources
  • Shop
  • Contact
  • Modern Finance Club
Jennifer Haley - Modern Finance
  • Home
  • About
  • Services
  • Resources
  • Shop
  • Contact
  • Modern Finance Club
Picture
    Picture

    JENNIFER HALEY, CPA

    Hi there, I'm Jennifer Haley, CPA. I'm here to help business owners get a handle on their finances so they can get back to doing the things they love. 

      Want to Join our email list?

    Subscribe

    Categories

    All
    MONEY MATTERS
    SOLE PROP ZONE
    TAX AND COFFEE

    Archives

    January 2022
    September 2021
    February 2021
    January 2021
    November 2020
    October 2020
    September 2020
    August 2020

    RSS Feed

Back to Blog

MILEAGE LOG

10/20/2020

 
​Explicit Content Warning ⛔️ Mileage Log - Create and Maintain one!⁠
.⁠
Let me guess, your accountant or business advisor has told you that you need to have and manage a vehicle mileage log for tax time. ⁠

But the end of year is coming and all you have is a blank page of paper 🗒️...did I catch you?⁠

I’m here to help you through the process and provide some insight and tips on how to manage it.⁠

The Canada Reveune Agency (CRA) provides 2 different methods for maintaining your mileage logbook:
  1. Full Logbook
  2. Simplified Logbook

The full logbook is what you would expect, keeping track of all of your mileage for the year, each and every year.

The simplified logbook however allows you to maintain a logbook for a period of 1 year which establishes a base year. Each year going forward you are only required to maintain a logbook for a period of 3 months and as long as it is within a range of 10% from your base year, you are then able to use your base rate as your multiplier. I know, it doesn't sound simplified, but let me break it out in an example:

Mike's Carpentry managed its log and determined it drove a total of 1,000kms in year 1; 200kms were related to personal use. Therefore 80% was business related and 20% was personal.

In year 2, Mike's Carpentry kept a log for only 3 months and determined in those 3 months it drove 400kms and 72kms were related to personal use. Therefore 82% is business related and 18% is personal.

Mike's Carpentry's base log and 3 month sample is within a 2% range and therefore Mike's Carpentry can use the rate of 80% against all vehicle expenses for year 2 and no longer needs to manage a log.

The simplified method can be very beneficial if you typically travel the same each year. 

If your travel can fluctuate or you like to just get in the habit of maintaining your log each year here are a few tips you can use to help you:
  • Also record your beginning and end of year odometer reading.
  • Instead of tracking each km as you drive, remember Google maps can be your best friend. Sit down each Friday and map out and record your week. For example, you traveled from Halifax to Windsor everyday for work, Google maps would show that is 63kms each way therefore you know you traveled 630kms for work in the week.
  • Take advantage of the many different apps that provide mileage tracking, many are built into your accounting software like QuickBooks. Other ones available are: MileIQ, TripLog, and Hurdlr.
  • Put a notebook in your car and make the km log part of your day when you start the car in the morning and park it in the evening.

Mileage logs can be on our side, we just need to utilize the tools available to us, like apps and Google maps :)

Jennifer H.
Xo
1 Comment
Read More
Lawrence link
9/21/2021 07:00:55 pm

Interesting thougghts

Reply



Leave a Reply.

 COPYRIGHT © JENNIFER HALEY, CPA 2020. SITE BY SKYSAIL.