Claiming Mileage

[ilusiv]

Hi,

I had been keeping a log of my trips out to my rental (about 15km away). We have another that is literally a few houses up from us so haven't bothered with that one.

What I have done is listed the date, the distance travelled, and the reason (all supportable by receipts / inspection documents etc), but I haven't actually recorded the odometer of my car.. is this an issue for when we go to see our accountant? Or does this mean that we just can't claim mileage if I haven't recorded the odometer.

Our tenants are great, so we actually havent been out there much, it came to a spot over 400km total in one year (including inspections, maintenance and showing tenants around etc).

How should I be doing this in future?

[Keys]

No records. Claim 25%

[Eugene]

What about finding the distance on google maps?

[BigRedDog]

Distance travelled is already logged.

[Nan]

From your receipts you should know the days you travelled. You already know how far you have travelled. So you should be able to guess ta mate some entries in your log book. Your not deceiving the IRD as you have actually incurred that expense.

[jimO]

so you keep a logbook to differentiate between private and business miles? pay commercial insurance on your vehicle?

[essence]

I used to note in my diary the day/time, what I was there for (inspection, maintenance), mileage for any side trips to Placemakers/Mitre 10 to pick up goods etc.

In your case, I would also note the rental that is closer to you.

At the end of the year, I'd submit this information to the Accountant and let him sort it out. The claimable amount per mile has changed recently, so it would pay to check up on that.

It's really surprising how quickly these little trips mount up.

[Keithw]

It's really surprising how quickly these little trips mount up.

Agreed

The 400km mentioned above should not be an issue, but watch out when your distance gets to around 2500km, i think thats the limit you can claim without a proper log book.
Not usually an issue for just a couple of rentals, but as the number grows, so does your milage.

[Rosco]

No records. Claim 25%

Can't just claim 25% as a right. Still must be a fair reflection on your travel. So if your business travel is really only 5-10%, then can't claim 25%.

If however your % is a lot higher, but you don't have a log book (keep for 3 months and last 3 years), then could claim the 25% amount. For most businesses this 25% would be easy to justify, but not for most rental owners.

Most small investors (say 1-3 or even 5 properites) would keep track of their mileage then claim the IRD or AA rates. Note AA rates are normally higher, so we normally use these. Plus allows a higher rate if you have a bigger car!

For small mileage IRD won't have an issue, as long as you have some kind of rental. For many clients if is only small we might go it is 5 km there and 5km back, and you go 5 times a year, so that is 50km. If your mileage is really high, then you would want a good log book to justify this if you had to.

Ross

[epsomtax]

Agreed

The 400km mentioned above should not be an issue, but watch out when your distance gets to around 2500km, i think thats the limit you can claim without a proper log book.
Not usually an issue for just a couple of rentals, but as the number grows, so does your milage.

The mileage rate for motor vehicles is 77 cents per kilometre. You can use this rate for up to a maximum of 5,000 km of work-related travel per year. For distances greater than 5,000 km, you must keep a record of actual vehicle expenses.

http://www.ird.govt.nz/business-income-tax/expenses/mileage-rates/