If you use a vehicle in your business that is not exclusively for business then you need to run a log book for 3 months every 3 years detailing your trips and what they are for so you work out what percentage of your travel is for business use. This percentage is then used to calculate the amount of expenses related to running the vehicle that can be claimed as a business expense.
Typically the process has been done in manual logbook and it easy to forget to do and often does not get done at all which does leave clients exposed if there were to be audited by the IRD.
In the last couple of weeks I have trialed a device which automatically collects my trip data and provides this data in a format that can be downloaded into a spreadsheet to be summarised and analysed.
This is not an expensive device either with a current price of $129.
So how does it work:
- You buy the device from gpslogbook.co.nz
- You connect to your computer and setup an account
- You plug it into the lighter in your vehicle and it will automatically collect data
- Every now and then you take it out of your vehicle and connect it to your computer and it will download the data collected to the GPS Log Book software
- Mark your trips as business or private in the software
- They provide an online account to view your data (including in Google Maps) for free for the first year and then if you want that ongoing there is a small annual subscription
- You can then download your trip data to a spreadsheet to calculate your business usage or send it to your accountant to do this for you
Other usages and benefits from this device
- It can also be used for mileage claims for employees
- You can view your trips and see how efficiently your travel is
- When viewing your trips you may identify shorter / faster routes
- You could also combine this data with fuel spend to work out your fuel efficiency
Anyway my overall experience with this device is that it was very simple to use and I have found the information much more useful than just creating a log book of my travel.