How to Track Mileage for CRA: A Calgary Business Guide

If you use a vehicle for your Calgary business, tracking your mileage correctly is one of the most important things you can do to maximise your tax deductions. CRA requires a detailed log to support any vehicle expense claim, and failing to keep one can result in your entire deduction being denied during an audit.

Why Mileage Tracking Matters

Vehicle expenses — including fuel, insurance, maintenance, lease payments or depreciation, and parking — are only deductible to the extent the vehicle is used for business purposes. If your vehicle is 60% business use, you can deduct 60% of eligible costs. But CRA won't accept a guess. You need a contemporaneous log showing each business trip.

What CRA Requires in a Mileage Log

For each business trip, your log should record:

• The date of the trip
• The destination (client name or business purpose)
• The number of kilometres driven
• The business purpose of the trip

At the end of the year, you need your total kilometres driven (business and personal) to calculate your business-use percentage.

Manual vs. App-Based Tracking

You can keep a paper logbook, but most Calgary business owners find a mileage-tracking app much more practical. Apps like MileIQ, Driversnote, or QuickBooks mileage tracking use your phone's GPS to automatically record trips. You simply classify each trip as business or personal. This dramatically reduces the effort involved and produces a CRA-compliant log.

The Simplified Method

CRA allows a simplified logbook method where you keep a detailed log for one representative three-month period and use that percentage for the full year, provided your driving pattern is consistent. This can reduce the ongoing tracking burden, but the initial three-month log must be thorough.

Common Mistakes Calgary Business Owners Make

• Not logging commuting trips. Driving from home to your regular workplace is personal, not business. Only trips to client sites, secondary locations, or business errands qualify.
• Reconstructing logs after the fact. CRA specifically looks for "contemporaneous" records — logs created at the time of the trip, not recreated months later from memory.
• Claiming 100% business use. Unless you have a dedicated business vehicle that is never used personally, claiming 100% is a red flag that invites audit scrutiny.

How Castle Bookkeeping Can Help

We help Calgary business owners set up mileage tracking systems, calculate their business-use percentage, and claim the correct vehicle deductions on their tax returns. If you've been guessing on mileage, let's get it right. Book a free consultation today.