Unfortunately, to claim motor vehicle expenses, the CRA requested to keep proper support of the amount you can deduct. This means that you will need to record the total kilometres you drive and the kilometres you drive to earn income. A proper mileage log must include:
- The date of the trip
- The purpose of the trip
- The destination
- The distance travelled
Be also aware that you can only claim vehicle expenses if you keep receipts of all eligible vehicle expenses that you can deduct (fuel, maintenance, insurance, license, and so on).
Please note that without a proper logbook you will not be able to back up your claims should you face an audit by the CRA, will be difficult to track personal and work or business use separately, or you may miss out on potential vehicle expense deduction.
However, you may interest to know that the CRA considers two types of motor vehicle records as acceptable methodologies. Full logbook and simplified logbook. For a simplified logbook, you can choose to maintain a full logbook for one complete year to establish a base year’s business use of a vehicle. After one complete year of keeping a logbook to establish the base year, you can use a three-month sample logbook to foresee business use for the entire year, as long as the usage is within the same range (within 10%) of the results of the base year. Please visit Motor vehicle records to see examples of how to apply a simplified logbook. This methodology may be useful to determine your 2020 mileage log if you have proper records from prior years.
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