How to claim mileage for your small business

Vehicle mileage is one of the most common areas that is recorded incorrectly in the accounting process.  Many people put through their fuel receipts as an expense, some also put through maintenance and other vehicle expenses.  The only time you should be doing this, is if the vehicle is owned by the company.  Whilst this may sound like a great idea, if you utilize your vehicle for any kind of personal use, you are subject to various “usage taxes” if you class it as a company vehicle and it really doesn’t work out in your favour unless the company vehicle is parked at company premises each night.

If your vehicle is not owned by your company as is the case with most sole proprietors, the best way to claim your expenses is through mileage.  The Canadian Revenue Agency allows a very healthy:

  • 54¢ per kilometre for the first 5,000 kilometres driven; and
  • 48¢ per kilometre driven after that.

Of course you have to be able to demonstrate that you actually drove the KM’s you say you did to be able to claim, so you need to keep some kind of mileage log, along with all of your gas receipts and maintenance receipts.  Even if your trips were mostly personal you should keep your gas receipts!

At the end of your fiscal year, add up all of your KM’s in your log  and multiply it by .54¢ if it’s less than 5000kms and put that amount through your books as an auto expense! Easy Peasy!

Download my Mileage Tracker PDF form below for you use or check out some of these Apps for smart phones!


Mileage Tracker PDF 

  • Fuel Buddy
  • Trip 2.0 Mileage Tracker
  • Mile IQ