What is mileage reimbursement?
What counts as business mileage
- driving to meetings or conferences that are for business but not at your typical workplace
- running errands or getting supplies for the business
- traveling from your usual workplace to a secondary or alternate place of business (i.e. a second office or a client’s office for a business meeting)
- traveling between two or more places of employment, for example, if you have more than one job
- going on customer visits
How to use the mileage reimbursement method
- how far they drove (in kms)
- the trip dates
- the trip purpose / business relation
How to use the logbook method
- operate a non-standard vehicle for business purposes, such as a van or motorcycle, or
- drive more than 5,000km for business each year,
- keeping your logbook
- keeping records and receipts of expenses
- calculating your deduction
1. Keeping a logbook.
- the odometer reading at the start and end of each trip
- the destination of each trip
- the business purpose of each trip
- total number of kilometres traveled during each period
- odometer readings for the start and end of the logbook period
2. Keeping records and receipts
- fuel and oil receipts
- registration costs
- insurances
- car services and regular upkeep
- tires and general repairs
3. Calculating your deduction
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Frequently Asked Questions about mileage reimbursement
How many kms can you claim for reimbursement without receipts?
As an employee, should I claim mileage deductions on my taxes if I drive for work?
As an employer, do I have to reimburse employees for mileage at the set ATO rate?
What vehicle expenses are tax deductible?
- employees, if your employer doesn’t provide you with a tax-free reimbursement scheme, or
- employers, if you reimburse employees for vehicle expenses using an actual costs method.
- fuel and oil expenses
- registration costs
- vehicle insurances
- lease payments and interest charges
- depreciation value
- car services
- tires and repairs
- electricity charges
- capital costs, i.e. the purchase price of your car
- improvement costs, i.e. tinted windows, winter protection, etc.
- individual expenses if you’re already claiming, or being reimbursed for, mileage using a cents-per-km scheme