What Are The CRA Rules For Claiming Company Vehicle Mileage?

Using your vehicle for business? The CRA lets you claim mileage, but only if you play by their rules. To stay onside with the Canada Revenue Agency (CRA), you need to separate business and personal use. That means you can’t just ballpark your mileage or guessimate the split.

Driving to meet clients? That’s business. Hauling supplies between job sites? Still business. Commuting to and from your regular workplace? That one’s a no-go.

The CRA doesn’t want your best guess. They want numbers. Actual, consistent numbers. So here’s what your mileage log must include:

1. Date of each trip
2. Start location and end location
3. Total distance driven (in kilometers)
4. The purpose of the trip

You’ll also need two odometer readings: one on January 1 and another on December 31. That’s your total annual mileage. From there, the CRA calculates what percentage is for business.

If you’re using more than one vehicle, keep separate logs for each.

Remember These Details to Stay Compliant

To stay compliant with CRA vehicle mileage rules, consistency is everything. Start by tracking your mileage daily. Whether you prefer a physical logbook or a mileage tracking app, what matters most is accuracy. Each business trip should include the date, destination, reason for the trip, and the number of kilometers driven. 

Beyond the logbook, save every vehicle-related receipt, including fuel, maintenance, insurance, lease payments, even parking if it's tied to a client visit. These documents back up your claims for at least six years, which is the standard audit window.

It's also a good idea to recalculate your business-use percentage each year since driving habits change. If you switch roles, pick up a new client base, or change how often you're on the road, let your employer or accountant know. It’s these small updates that keep your claim tight, your finances clean, and your audit risk low.

Don't Get Burned By Guesswork

Claiming company vehicle mileage isn’t complicated, but it does demand discipline. That is why we encourage everyone to keep detailed mileage logs, save receipts, and recalculate your usage annually to save you stress, money, and the hassle of a potential audit.

With the right tracking habits, claiming mileage becomes routine instead of risky. Think of it as protecting your write-offs before they disappear in a CRA audit.

Located in Surrey (Cloverdale), British Columbia, since 1971, HWG, Chartered Professional Accountants proudly helps clients throughout the Lower Mainland and across Canada.

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