Vehicle for business use

Mirage · 03-11-2004, 06:05 AM

Anybody here using their car or have used their car for business?

I'd like to know what can be qualified for write offs.. including maintenance, repair, parts (necessities like tires, or mods + upgrades such as an extra set of wheels and HIDs), etc..

I'm looking for ppl that has done this before to post their experience and knowledge.

I haven't talked to an accountant yet but it'd be great if someone here can shed some light on this topic before I do that.

Thanks in advance.

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Necromancer · 03-11-2004, 01:17 PM

Yeah, US laws and Canadian laws are very similar. You just say you're using some percentage of your car for work, and some percentage for personal use, and scale all your deductions accordingly. Now, here's the problem -- you have to be able to prove it. That means you have to keep a log of where you drove, and customer receipts showing that you actually made an on-site visit. Probably your coworkers are in the same situation, so your company may have preformatted log books (they do reimburse you for travel, right?). In that case it should be fairly easy -- just divide the number of km's you drove for work by the total mileage and use that to scale all your deductions.

I'm not sure things like HID's would qualify for a deduction (scaled by the business use percentage, of course). The general tax rule is that if something is necessary for your business, then it's deductible. Then again, there's nothing that says you can only deduct the value of a 1985 CVCC as the minimum cost of basic transportation, either.

Car deductions are a big audit trigger, though, so make sure you do everything by the book if you're going to take the deduction.

And of course, I'm no accountant, so anybody reading this shouldn't rely on my advice.

quest · 03-11-2004, 02:56 PM

yea, my bro's old roommate used to use his XTerra for his biness. He had to keep track of every place he drove for work, distance, date, time, etc...

Mirage · 03-11-2004, 03:28 PM

Cool, thanks guys. We got these monthly planners so we keep track of mileage that way.

My main concern is parts. A few has suggested to me I should just submit the receipts and see if it works out (for extra wheels/tires, reasonable sounding items).. If it doesn't work then it doesn't work. If they plan on auditing me I'll always have my logs and paperwork to back up my business use %, etc.

I hear as long as I'm somewhere around 70-80% business use I should be fine.

Anyone else use their cars for business? I agree, the mileage adds up super fast.

If there's no more input.. guess I'll just call up my accountant.

keno · 03-11-2004, 03:56 PM

General rule of thumb is...." expenses inccured to make income" can be written off.

If your line of work (ie: outside sales, on-site repairman, delivery boy, etc...)`requires you to use a vehicle and they don't provide a company vehicle , then you need to see if there is a stipend or per diem for your expenses. If there is none, then make sure you ask your HR department or whoever issues you your paycheque about a T2000 form. The details of whether you get anything is noted on this tax form. Without this form, it's hard to justify your expenses.

Also, the average market price for kilometage is $0.27-0.38 / km. There's ways to deal with writing off vehicles.

I use to have a fleet of 4 sales reps plus myself and we all wrote off our vehicles. If you want to talk about this - PM me.

Mirage · 03-11-2004, 04:24 PM

Ok, pm'd u..

[freeman] · 03-11-2004, 04:50 PM

mirage, you finally deciding to write off those so called "service calls" to your "clients?" :S you might need receipts for those services provided....

Necromancer · 03-11-2004, 06:09 PM

Cool post keno ... Mirage, if you find more information, could you please post it to the thread for archiving's sake?

STinger · 03-12-2004, 01:18 AM

Hey Ken,

You and I are in the same line of work (info technology). I've been able to claim insurance cost, lease payments or loan interest, maintenance, and some of the upgrade parts (i.e. tires and wheels). If you purchased the car, you're also entitled to write off the depreciation on it. Since you're Netfiling most of the stuff, you won't have to provide the information when you file, but of course need to hang on to the receipts in case you're audited.

My company also provides me with the T2000 form outlining what I get, or what they require me to provide in order to do my work (for example, I get to write off a proportionate amount of hydro and telephone for the amount of space I use for my home office). Employees on commission get to write off even more. Check out this deduction as well -- any extra money you save can go to more car stuff.

Martin

03-11-2004, 06:05 AM	#1
Mirage NASIOC Supporter Member#: 155 Join Date: Aug 1999 Chapter/Region: VIC Location: Burnaby, BC, Canada Vehicle: 01 RS Coupe/Silver 00 SiR/06 ZX-6R	Vehicle for business use Anybody here using their car or have used their car for business? I'd like to know what can be qualified for write offs.. including maintenance, repair, parts (necessities like tires, or mods + upgrades such as an extra set of wheels and HIDs), etc.. I'm looking for ppl that has done this before to post their experience and knowledge. I haven't talked to an accountant yet but it'd be great if someone here can shed some light on this topic before I do that. Thanks in advance. * Registered users of the site do not see these ads.

03-11-2004, 01:17 PM	#2
Necromancer Scooby Specialist Member#: 477 Join Date: Oct 1999 Location: Vancouver Vehicle: GC4 -> GGA -> GM6 Yeah, that's about right.	Yeah, US laws and Canadian laws are very similar. You just say you're using some percentage of your car for work, and some percentage for personal use, and scale all your deductions accordingly. Now, here's the problem -- you have to be able to prove it. That means you have to keep a log of where you drove, and customer receipts showing that you actually made an on-site visit. Probably your coworkers are in the same situation, so your company may have preformatted log books (they do reimburse you for travel, right?). In that case it should be fairly easy -- just divide the number of km's you drove for work by the total mileage and use that to scale all your deductions. I'm not sure things like HID's would qualify for a deduction (scaled by the business use percentage, of course). The general tax rule is that if something is necessary for your business, then it's deductible. Then again, there's nothing that says you can only deduct the value of a 1985 CVCC as the minimum cost of basic transportation, either. Car deductions are a big audit trigger, though, so make sure you do everything by the book if you're going to take the deduction. And of course, I'm no accountant, so anybody reading this shouldn't rely on my advice. Last edited by Necromancer; 03-11-2004 at 01:24 PM.

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03-11-2004, 02:56 PM	#3
quest * Banned * Member#: 42402 Join Date: Aug 2003 Location: 4 inches south of :coffeemug: Vehicle: - Finder of Porn -Bringer of tears...	yea, my bro's old roommate used to use his XTerra for his biness. He had to keep track of every place he drove for work, distance, date, time, etc...

03-11-2004, 03:28 PM	#4
Mirage NASIOC Supporter Member#: 155 Join Date: Aug 1999 Chapter/Region: VIC Location: Burnaby, BC, Canada Vehicle: 01 RS Coupe/Silver 00 SiR/06 ZX-6R	Cool, thanks guys. We got these monthly planners so we keep track of mileage that way. My main concern is parts. A few has suggested to me I should just submit the receipts and see if it works out (for extra wheels/tires, reasonable sounding items).. If it doesn't work then it doesn't work. If they plan on auditing me I'll always have my logs and paperwork to back up my business use %, etc. I hear as long as I'm somewhere around 70-80% business use I should be fine. Anyone else use their cars for business? I agree, the mileage adds up super fast. If there's no more input.. guess I'll just call up my accountant.

03-11-2004, 03:56 PM	#5
keno Scooby Newbie Member#: 7021 Join Date: May 2001 Location: vancouver, bc, canada	General rule of thumb is...." expenses inccured to make income" can be written off. If your line of work (ie: outside sales, on-site repairman, delivery boy, etc...)`requires you to use a vehicle and they don't provide a company vehicle , then you need to see if there is a stipend or per diem for your expenses. If there is none, then make sure you ask your HR department or whoever issues you your paycheque about a T2000 form. The details of whether you get anything is noted on this tax form. Without this form, it's hard to justify your expenses. Also, the average market price for kilometage is $0.27-0.38 / km. There's ways to deal with writing off vehicles. I use to have a fleet of 4 sales reps plus myself and we all wrote off our vehicles. If you want to talk about this - PM me.

03-11-2004, 04:24 PM	#6
Mirage NASIOC Supporter Member#: 155 Join Date: Aug 1999 Chapter/Region: VIC Location: Burnaby, BC, Canada Vehicle: 01 RS Coupe/Silver 00 SiR/06 ZX-6R	Ok, pm'd u..

03-11-2004, 04:50 PM	#7
[freeman] Scooby Specialist Member#: 476 Join Date: Oct 1999 Location: Vancouver Vehicle: 2003 GPW s2000 Former WRX owner	mirage, you finally deciding to write off those so called "service calls" to your "clients?" :S you might need receipts for those services provided....

03-11-2004, 06:09 PM	#8
Necromancer Scooby Specialist Member#: 477 Join Date: Oct 1999 Location: Vancouver Vehicle: GC4 -> GGA -> GM6 Yeah, that's about right.	Cool post keno ... Mirage, if you find more information, could you please post it to the thread for archiving's sake?

03-12-2004, 01:18 AM	#9
STinger Scooby Newbie Member#: 19410 Join Date: May 2002 Chapter/Region: VIC Location: Richmond, BC Vehicle: '02 WRX Sedan '95 LWRX Stage Rally	Hey Ken, You and I are in the same line of work (info technology). I've been able to claim insurance cost, lease payments or loan interest, maintenance, and some of the upgrade parts (i.e. tires and wheels). If you purchased the car, you're also entitled to write off the depreciation on it. Since you're Netfiling most of the stuff, you won't have to provide the information when you file, but of course need to hang on to the receipts in case you're audited. My company also provides me with the T2000 form outlining what I get, or what they require me to provide in order to do my work (for example, I get to write off a proportionate amount of hydro and telephone for the amount of space I use for my home office). Employees on commission get to write off even more. Check out this deduction as well -- any extra money you save can go to more car stuff. Martin