If a vehicle is part of how you earn, the logbook method is usually the difference between an average claim and the claim you are actually entitled to. And the new financial year is the perfect time to start one.
How it works
Keep a logbook for a continuous 12 week period that fairly represents your travel. For every trip you record the date, the odometer at the start and end, the kilometres and the reason. That gives you a business use percentage, and you can then claim that share of all your car costs: fuel, rego, insurance, servicing, depreciation and interest.
Why it beats the shortcut
The cents per kilometre method is capped at 5,000 business kilometres a year. A tradie or consultant doing real kilometres in a real vehicle typically leaves serious money on the table with the shortcut. The logbook method has no cap, just the percentage you can prove.
The five year payoff
A valid logbook keeps working for up to five years, as long as your pattern of use stays representative and you note the odometer at the start and end of each year. Twelve weeks of minor discipline, five years of maximum claims.
The fine print that matters
- Sole traders and partnerships with individual partners can use the logbook or cents per kilometre methods for cars. Companies and trusts claim actual costs based on business use instead.
- An app is fine. Several will build the logbook from your phone's GPS, and the ATO accepts electronic logbooks.
- Home to your regular workplace is private travel, not business, no matter what is in the boot.
Start the logbook this week and it will be done before BAS season gets serious.