CRA logbook requirements for business kilometres
The Canada Revenue Agency lets you deduct the business share of your vehicle costs, and the share is set by kilometres. The logbook is the evidence for that share. This page covers what the CRA asks for in a logbook, the base year and simplified logbook rules, and how long to keep the records. The source is the CRA page on motor vehicle records.
This page is general information, not tax advice. The United States counterpart is what the IRS requires in a mileage log.
What each trip must record
For every business trip, the CRA asks for four things.
- The date
- The destination
- The purpose
- The number of kilometres you drive
The CRA does not ask you to record personal trips one by one. It asks for the total kilometres for the year, which is why the odometer readings matter.
Odometer readings
Record the odometer reading of each vehicle at the start and end of the fiscal period. If you buy, sell, or trade a vehicle during the year, record the odometer reading on that day too. The difference between the start and end readings is the total kilometres for the year, and business kilometres divided by that total is the business share you use on your return.
The full logbook and the base year
The CRA says the best evidence of business use is an accurate logbook kept for the entire year. A full 12-month logbook also establishes a base year, which is what makes the simplified logbook possible in later years.
The simplified logbook
After you have one full base year, you can keep a logbook for one continuous 3-month period in a later year and use it to project the whole year. The formula is
(sample period business %) ÷ (base year business % for the same period)
× (base year annual business %) = calculated annual business %
The CRA example is a sample period at 51% business use, the same period in the base year at 46%, and a base year annual figure of 49%. The calculation is 51% ÷ 46% × 49% = 54%.
The projected figure is valid only if it is within 10 percentage points of the base year annual figure. In the example, the base year is 49%, so the acceptable range is 39% to 59%. If the projection falls outside the range, the base year no longer represents your driving, and you need a new full-year logbook.
Personal and business driving
Driving between your home and a regular place of work is personal. Driving from your home directly to a client or customer site is business. The CRA lists exceptions to the commuting rule, including a home office that is your regular workplace, security-restricted sites, and remote or special work sites. The T2125 motor vehicle expenses guide covers the employee side, with the T2200 and T777 forms.
How long to keep the logbook
Keep the full-year logbook for six years from the end of the tax year for which it was last used to establish business use. The general rule for records is six years from the end of the tax year they relate to, per the CRA guide on keeping records. A base-year logbook can support several later years, so its retention clock starts from the last of them.
How Miles handles this
- A vehicle set to the Canada tax region is tracked in kilometres. Every drive stores the date, the start and end address, the purpose, and the kilometres, along with the time the record was created.
- The app asks for the odometer reading at the start and end of each year and on the day you add or remove a vehicle.
- Full logbook mode records the whole year. After a base year, the simplified logbook mode records a continuous 3-month sample, computes the CRA formula, and warns when the projection is more than 10 percentage points from the base year.
- The CRA logbook PDF lists each trip with the four elements, the odometer readings, and the year totals. Exports and the JSON backup cover the six-year retention period, and the log stays readable after a subscription lapses.
Miles is coming soon.
Video
This page's video shows a base year, a three-month sample, and the projection. The steps it records are written up in the Canada logbook video script.