Logbook vs Cents per KM: Which Pays More?

Use your car for work and the ATO lets you claim some of its costs as a deduction (an expense subtracted from the income you get taxed on) — but you must pick one of two methods. Door one: cents per kilometre — a flat 88 cents per work kilometre in 2025-26, minimal paperwork. Door two: the logbook method — track your driving for 12 weeks, then claim the work share of every real car cost.

Pick lazily and you can leave four figures on the table. Here's how each works and where the crossover sits.

Count your work kilometres for the year, multiply by 88 cents, done. Drive 3,000 work kilometres and that's a $2,640 deduction. The rate is all-inclusive — it bundles fuel, rego, insurance, servicing and depreciation (the car losing value as it ages) — so you can't claim any car cost on top of it.

The ceiling: 5,000 work kilometres per car, per year, capping the method at $4,400. No receipts needed, but you must be able to show how you worked out your kilometres — diary entries, a work calendar, anything better than vibes.

The logbook method claims the work-use percentage of your actual car costs. For 12 continuous weeks, record every trip — date, odometer start and finish, kilometres, and the reason. That becomes your car's work-use score: if 60% of your driving was for work, you claim 60% of your fuel, rego, insurance, servicing, car loan interest and depreciation for the whole year.

The kicker: one logbook is generally valid for five years, as long as your driving pattern doesn't change much. Twelve weeks of discipline, five years of claims.

Under both methods, only work travel counts. Driving between two jobs, out to see clients, between work sites, picking up supplies — all in. Home to work and back is private, always, under both methods.

Get this wrong and the method comparison is moot — you're comparing two ways of claiming kilometres you were never allowed to claim.

Low work kilometres — occasional site visits, a few client trips a month — and cents per kilometre usually wins: near-zero paperwork, and 88 cents is generous for a cheap-to-run car doing light duty.

High work kilometres flip it. Well past 5,000 work kilometres a year, the flat method hits its $4,400 ceiling while your actual costs keep climbing — a rep doing 15,000 work kilometres in a $40,000 car can find the logbook method worth two or three times the capped claim, mostly thanks to depreciation. Expensive car, big loan, high work use: logbook. Old Corolla, modest work driving: cents per kilometre. In between? Do the 12 weeks once and let the numbers decide.

One car, one method per year — you can't claim 88 cents a kilometre and your fuel receipts. But you can switch methods between years, and if your work driving is growing, the 12-week logbook is the best-paying homework you'll do all year.

Once you know your claim, drop it into our Deduction Estimator to see what it does to your refund at your tax rate.