Mileage logged in June is worth more than mileage remembered in March

A vehicle used for work is often the single largest deductible expense a small operator has, and it is the one most likely to be reduced or disallowed, for a simple reason: the deduction rests on a record that nobody else creates for you. Bank statements prove what you spent. Nothing but a log proves where you drove.

Mid-year is the right time to look at this, because the half of the year already gone can still be reconstructed from calendars and job records while the details are recoverable, and the half ahead can be logged properly.

What a log has to contain

Four items per trip, and that is genuinely all.

• The date
• The starting and ending point, or the destination and purpose
• The business reason, in a few words
• The miles

Plus two readings that belong to the year rather than the trip: the odometer at the start of the year and at the end. Those two figures establish total miles, which is what the business share is a share of.

The form does not matter. A notebook in the door pocket, a spreadsheet, or an application that records trips from the phone are all acceptable, and the application is the one people actually maintain because it removes the decision. What matters is that entries are made at the time or close to it.

The two methods, and the choice that is harder to reverse

The bottom row is the reason to decide deliberately in the first year a vehicle is used for business rather than drifting into a method. The rules on switching are specific and depend on what was elected initially, and getting advice once at the start is cheaper than discovering the constraint in year three.

Note that the log is required either way. People sometimes believe that choosing actual expenses removes the need to track mileage. It does not, because the business percentage applied to those expenses is derived from miles.

The trips that do not count

Commuting heads the list. The drive from the house out to a regular workplace is personal mileage, no matter how early it starts, how far it runs, or how completely it feels like part of the job. That lands badly on people whose work is genuinely mobile, and everything hangs on the second half of the phrase: regular workplace.

Set up a home office that qualifies as the principal place of business and the geography changes.

The run from there to a job site stops being a commute and counts as business travel, which for a tradesperson working out of a house is a large number by the end of a year. It is also the point in this whole area most worth confirming with someone rather than assuming.

Other common errors: personal errands folded into a business trip without separating the miles, and a trip counted twice because it appeared on both a calendar and an invoice. A log that is generous in a way that cannot be explained is worse than a modest one that can.

The local detail that catches people

Anyone working across municipal boundaries picks up complications that have nothing to do with taxes but interact with the same records. Some cities levy their own business taxes based on where work is performed.

Some require a local license for work inside their limits. Parking, tolls and bridge crossings are separately deductible from the standard mileage rate and are individually small enough to be ignored, which across a year of daily crossings adds up to a real figure.

The practical answer is to record tolls and parking in the same log rather than in a separate system, since they attach to the same trip and are otherwise lost. A photograph of a parking receipt takes two seconds and belongs in the same monthly folder as everything else.

Reconstructing the half of the year already gone

A record made later is weaker than one made at the time, and it is much better than nothing. Calendar entries, job records, invoices with addresses, and the map history on a phone can between them rebuild a defensible account of where a vehicle went.

Do it now rather than in March, and note in the file how it was reconstructed and from what. A rebuilt log accompanied by an honest description of its sources is a reasonable document. The same figures presented as though they were contemporaneous are not, and the difference matters if anyone ever asks.

Then start the proper log the same afternoon. Whatever the first half of the year was worth, the second half is now a matter of record.