If you use your car for business purposes, you may be able to claim a deduction for your car expenses on your tax return. However, to do so, you need to keep accurate and reliable records of your business-related car use. This can be a tedious and time-consuming task, especially if you have multiple vehicles or drivers. Fortunately, there is a simple and effective solution: a GPS tracking device.

A GPS tracking device is a small device that you can install in your car, either covertly or overtly, that uses satellite or cellular signals to track your car’s location, speed, and activity in real-time. With a GPS tracking device, you can easily and automatically record your business-related car trips, generate trip reports and mileage logs, and calculate your claim using the ATO-approved methods. In this article, we will explore some of the benefits of using a GPS tracking device for tax reporting, and how it can save you time, money, and hassle.

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Benefits of Using a GPS Tracking Device for Tax Reporting

Using a GPS tracking device for tax reporting can offer you many advantages, such as:

  • Accuracy: A GPS tracking device can provide you with precise and reliable data on your car’s movements, such as the date, time, distance, and purpose of each trip. This can help you avoid errors, omissions, or estimations that could result in under-claiming or over-claiming your car expenses. A GPS tracking device can also help you comply with the ATO’s record-keeping requirements, such as keeping a logbook for at least 12 continuous weeks, and retaining your records for five years.
  • Simplicity: A GPS tracking device can simplify your record-keeping process by automating and digitising your trip records. You don’t have to manually write down your odometer readings, fuel receipts, or other car expenses. You can simply access your trip data online or on your smartphone, and export or print your trip reports and mileage logs with a click of a button. You can also integrate your GPS tracking device with other software systems, such as accounting or invoicing software, to streamline your workflow and reduce paperwork.
  • Flexibility: A GPS tracking device can give you the flexibility to choose the best method to claim your car expenses, depending on your circumstances and preferences. You can use either the logbook method or the cents per kilometre method, as long as you meet the ATO’s eligibility criteria. A GPS tracking device can help you calculate your claim using either method, by providing you with the relevant data, such as your business-use percentage, total kilometres travelled, or total car expenses. You can also switch between the methods from year to year, as long as you keep a valid logbook.

How to Use a GPS Tracking Device for Tax Reporting

To use a GPS tracking device for tax reporting, you need to follow these steps:

  • Install a GPS tracking device in your car: You can choose from a variety of GPS tracking devices on the market, but make sure you select one that is compatible with your car, your devices, and your budget. You should also check if the GPS tracking device requires any wiring, installation, or subscription fees, and factor in the additional costs and requirements.
  • Record your business-related car trips: You need to record every trip you make in your car for business purposes, such as visiting clients, suppliers, or work sites. You can use a GPS tracking device to automatically record your trip data, such as the start and end date, time, location, and distance of each trip. You can also use a GPS tracking device to classify your trips as business or private, and add notes or labels to describe the purpose of each trip.
  • Generate your trip reports and mileage logs: You need to generate your trip reports and mileage logs for the income year, using the data collected by your GPS tracking device. You can use a GPS tracking device to easily and quickly generate your reports and logs, online via the Fleetminder Tracking platform. You can also customise your reports and logs, such as filtering by date, driver, vehicle, or trip type, and formatting by PDF, CSV, or Excel.
  • Calculate your claim using the ATO-approved methods: You need to calculate your claim for your car expenses using either the logbook method or the cents per kilometre method, as approved by the ATO. You can use a GPS tracking device to help you calculate your claim using either method, by providing you with the relevant data, such as your business-use percentage, total kilometres travelled, or total car expenses. You can also compare the methods and choose the one that gives you the best outcome.

Using a GPS tracking device for tax reporting can be a smart and convenient way to claim your car expenses on your tax return. A GPS tracking device can provide you with accurate and reliable data on your business-related car use, simplify your record-keeping process, and give you the flexibility to choose the best method to claim your car expenses. By using a GPS tracking device, you can save time, money, and hassle, and maximise your tax refund. Contact us for a quote.

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