Automobile Log
When claiming deductions for automobile-related expenses for business purposes, it is important to keep complete and proper records to maximize the allowable deductions.
This page provides a quick reference for automobile-related expenses and the information that your business advisor will need to claim these deductions.
CRA Administrative Policy on Automobile Logs
The best evidence to support automobile expenses is a complete log that documents business travel for the full year, with accurate records indicating each business trip, destination, purpose, and kilometers travelled.
Where certain conditions are met, the Canada Revenue Agency (CRA) has an administrative policy that allows self-employed individuals to track automobile expenses for business use in a tax year for a sample period where a vehicle is used for both business and personal purposes. Your business advisor can help determine if you are eligible for this method.
Quebec administers its own tax laws and policies. The Taxation Act (Quebec) contains similar provisions to the Income Tax Act for automobile expense deductions. Revenue Quebec (RQ) has indicated the simplified logbook method is also available to self-employed individuals in Quebec.
In addition, in Quebec, where an employer or related person provides an employee or related person with a car, the employee is required to provide their employer with a logbook within 10 days of December 31 if the car was available to them on that day or within 10 days of the last day they had the car. The employee is subject to a $200 fine for failure to provide the logbook as prescribed.
Automobile Usage
Details on business usage throughout the year should be tracked, including:
- Total kilometers driven (including portion for business use)
- Description or purpose of business use
- Relevant dates
- Places of departure and destination
- Parking costs
Other Automobile Expenses
Make sure to track all automobile expenses to provide to your business advisor. These expenses may include:
- Fuel
- Maintenance & Repairs
- Automobile Leasing or Ownership Information
- Costs (including sales tax) and details of vehicles purchased or sold during the year
- Costs (including sales tax) and details of vehicles leased (ongoing, new, or concluded leases in the year)
- Annual Expenses
- Insurance
- Vehicle registration
- Loan costs, if applicable (principal and interest)
Make sure you retain receipts of all expenses incurred. An entry on a credit card statement will not provide the level of detail required to support expenses claimed.