A sole proprietor’s use of motor vehicle for business purposes. What percentage of the expenses of the vehicle (eg. Fuel, repairs/maintenance/insurance and other vehicle expenses) can be written off as business expenses if for (a) no mileage log book is k
Important:
This answer is based on tax law for the tax year ending 28 February 2020.
Answer:
The adjustment can no longer be made on the basis of a percentage. The adjustment, under section 23(a) or 23(g), in respect of non-trade related travel must be based on a log book. Practice note 24 (8 August 1994: Private use of motor vehicle) was, in line with the amendment to section 8 that taxpayers are expected to keep better records, withdrawn with effect from years of assessment commencing on or after 1 March 2010. The practice note allowed for a percentage adjustment. The requirement is therefore that a logbook is required and, in a sense, the ‘percentage’ is then determined on the basis of the ratio of the actual business travel to the total travelled for the year.