An ATO logbook is valid for five years, provided it still broadly represents how the vehicle is used. In each of the four years after the logbook year you must keep odometer readings and the use percentage. Separately, you have to retain the logbook itself for five years after the latest income year you rely on it.
Key takeaways
- A logbook covering at least 12 continuous weeks is valid for five years, and you can start a new one at any time.
- In each of the four years after the logbook year you still need odometer readings for the start and end of the period you owned the car.
- You must retain the logbook and odometer records for five years after the end of the latest income year you rely on them — close to a decade for a logbook used its full life.
- For FBT, a year is a log book year if none of the previous four years was one, if you elect it, or if the ATO requires it by written notice.
- If you replace a vehicle you can transfer the business percentage across, but only if you record the make, model and registration of both cars and the replacement date.
How long is an ATO logbook actually valid?
Five years. A logbook covering at least 12 continuous weeks is valid for five years, and you can start a new one at any time if you want to.
The catch is the condition attached to it. The logbook has to stay broadly representative of how the vehicle is used. The ATO’s examples of a change that breaks that are changing jobs or moving house; for a business, it lists a change in the type of work the business undertakes.
So five years is a ceiling, not a guarantee. If a ute went from site deliveries to mostly yard work in year two, the percentage on file stopped being representative in year two — whatever the calendar says.
What do you have to record in the four years after?
The 12 weeks is the expensive part, and it only happens once. The four years that follow are not free, though.
For each of those years you need odometer readings for the start and end of the full period you owned the car during the income year, plus the work-related kilometres and use percentage for that year based on the logbook.
Miss a 1 July or 30 June reading and you have a gap you cannot reconstruct later. An odometer only ever shows today’s number.
| Year | What you have to record |
|---|---|
| Year 1 (logbook year) | 12 continuous weeks of journeys, odometer at the start and end of that period, odometer for the full ownership period |
| Years 2–5 | Odometer at the start and end of the ownership period, work-related kilometres, use percentage |
| Year 6 | A new 12-week logbook, unless you started one earlier |
Sole traders and partnerships have a longer list of what has to appear in the book itself: when the period begins and ends, the odometer readings at each end, total kilometres for the period, the kilometres for each journey, the business-use percentage, and the car’s make, model, engine capacity and registration number.
That last item catches people out. A spreadsheet of dates and distances with no vehicle identified on it is not a logbook, however diligently it was kept.
Each journey also has to carry its reason, its start and end date, the odometer readings at both ends, and the kilometres travelled — and it has to be entered at the end of the journey or as soon as possible afterwards. Two or more journeys made in a row on the same day can be recorded as one.
How long do you have to keep the logbook itself?
This is the part most guides skip, and it is where the real exposure sits.
Validity and retention are two separate clocks. The logbook is valid for five years. You must retain it, and the odometer records, for five years after the end of the latest income year you rely on them to support your claim.
Run that out. Record a logbook in year one, lean on its percentage through year five, and the latest income year you relied on it is year five — so the book has to survive five more years after that. A logbook used for its full life needs to be findable for close to a decade.
For FBT the rule is worded differently and lands in much the same place: keep your FBT records for five years from the date you lodge your FBT return, or five years from the 21 May lodgment due date if you are not required to lodge one.
Paper logbooks rarely survive that long in a glovebox. Deciding to run the logbook without a paper book is mostly a records-retention call, not a convenience one.
Does the FBT clock work the same way?
No — and this is where businesses providing vehicles to staff get tripped up. FBT has its own year and its own definition of a logbook year.
The FBT year runs 1 April to 31 March, not 1 July to 30 June. An income-tax logbook and an FBT log book year do not line up on the calendar at all.
Under the FBT rules, a year is a log book year if any one of three things is true:
- none of the previous four years was a log book year of tax for that car
- you elect to treat the year as a log book year, for example to increase the nominated percentage of business travel
- the ATO requires you to treat it as one, by written notice
That third one is worth reading twice. The five-year rule is usually presented as a fixed entitlement. It is not. The Commissioner can require a fresh log book year for a car by written notice, whatever your own five years say.
| Income tax logbook | FBT log book year | |
|---|---|---|
| Year runs | 1 July – 30 June | 1 April – 31 March |
| Sets the percentage | 12 continuous weeks | 12 continuous representative weeks |
| How long it holds | 5 years | Until none of the previous 4 years was a log book year |
| In the years between | Odometer readings, kilometres, percentage | Odometer records |
| Can it be forced to restart? | If it stops being representative | Yes — by written notice from the ATO |
| Records due | With your income tax return | FBT return due date, or 21 May |
If one vehicle is doing both jobs — a deduction in your return, and a car fringe benefit for whoever drives it home — you are running both clocks on the same ute at the same time.
What happens to the logbook when you replace the ute?
You do not automatically lose the percentage. Under the FBT rules you can treat a replacement car as though it were the car it replaced, and transfer the established business percentage across, provided that percentage remains appropriate.
The conditions are specific, and they are administrative rather than difficult:
- record the make, model and registration number of both the replaced and the replacement car
- record the date the replacement was made
- make those entries before your FBT return is due, or by 21 May if you do not lodge one
- keep odometer records showing the readings of both cars on the replacement date
Handle that at changeover and the percentage carries across. Handle it eight months later and you need an odometer reading nobody wrote down, on a vehicle that has already been sold.
What does an electronic logbook have to do to count?
The ATO sets out minimum requirements for electronic logbook devices, and they are more specific than “an app is fine”.
The device has to track distance accurately — GPS, or a connection to the car’s own on-board computer and odometer — with the opening odometer reading programmed in. It has to record the date and time of each journey, the distance travelled, and whether the journey was business or private.
Then comes the requirement people actually fail:
“Business” or “miscellaneous business” will not be enough.
The purpose has to be described well enough that the journey can be classified as a business journey. “Client” is not a purpose. “Quote — 14 Bourke St” is.
The reports also have to be generatable weekly and in English, and checked by the driver or the employer or both. The ATO’s stated preference is that this happens on the day of travel, though regular weekly intervals are accepted.
Axlerun records trips this way on the free plan — manual entries and the automatic GPS logbook are both included on Drive, for your first three vehicles free forever. The FBT logbook export, the Excel or PDF your accountant actually wants, is the paid step on Cruise. Recording is not the part we charge for.
What if the logbook has already lapsed?
Without a valid logbook you cannot use the logbook method. For income tax you may be able to use the cents per kilometre method instead, which needs no logbook but claims on an entirely different basis.
For FBT the fallback is harsher. You can still elect the operating cost method without a logbook, but you cannot reduce the operating cost for any business journeys — so the business use effectively counts for nothing. And if the operating cost method then produces a higher taxable value than the statutory formula, the election is treated as though it was never made.
Nothing requires a logbook to begin on 1 July. Twelve continuous weeks starting today is a valid logbook.
So the practical move is to start now rather than wait for the year to turn. And if you started using a car for business less than 12 weeks before the end of an income year, you can carry the logbook on into the next year to complete the 12 weeks.
Whether a lapsed logbook changes what you can claim this year is a question for your accountant. What is not in doubt is that the 12 weeks has to start somewhere, and the odometer reading you need is the one on the dash right now.
Frequently asked questions
Do I need to do a new ATO logbook every year?
No. A logbook covering at least 12 continuous weeks is valid for five years. In each of the four following years you keep odometer readings for the start and end of the period you owned the car, plus your work-related kilometres and use percentage. You only repeat the 12 weeks if the logbook stops being representative, or in the sixth year.
How long do I have to keep an ATO logbook after I stop using it?
Five years after the end of the latest income year you rely on it to support your claim. Because the logbook is valid for five years in the first place, a logbook you use for its full life can need to be retained for close to ten years in total. For FBT, records are kept five years from the date you lodge the FBT return.
Can the ATO make me start a new logbook before five years is up?
Yes. Under the FBT rules a year is a log book year if the Commissioner requires you to treat it as one by written notice, regardless of when your last logbook was recorded. Separately, for income tax, a logbook stops being usable once it is no longer broadly representative of how the vehicle is used — for example after a change in the type of work your business does.
Can one logbook cover all the vehicles in my fleet?
No. If you use the logbook method for two or more cars you need a logbook for each car, and they must all cover the same period. The 12-week period you choose should be representative of the business use of all of the cars, not just the one that does the most kilometres.
What happens to my logbook percentage if I replace the ute?
Under the FBT rules you can treat the replacement car as the car it replaced and transfer the business percentage, if it remains appropriate. You must record the make, model and registration number of both cars and the date of the replacement, before your FBT return is due or by 21 May. Odometer records must show both cars on the replacement date.
Is an app enough, or does the ATO want a paper logbook?
Electronic logbooks are accepted if they meet the ATO minimum requirements: accurate distance tracking via GPS or the car on-board computer, the opening odometer programmed in, the date, time, distance and business or private status of each journey, and a purpose described well enough to classify the trip. Reports must be producible weekly in English and checked by the driver or employer.
Sources
- 1.Logbook method (individuals) — Australian Taxation Office
- 2.Logbook method (business — sole traders and partnerships) — Australian Taxation Office
- 3.Fringe benefits tax – a guide for employers, Chapter 7: Car fringe benefits — Australian Taxation Office
- 4.Fringe benefits tax – a guide for employers, Chapter 21: Employee cars — Australian Taxation Office
- 5.Record keeping for FBT — Australian Taxation Office
- 6.Taxable value of a car fringe benefit — Australian Taxation Office
- 7.Fringe benefits tax – rates and thresholds — Australian Taxation Office
Axlerun is fleet software, not a tax agent. Rates and rules change — confirm anything that affects your return with your accountant or the ATO.
Fleet admin, minus the admin.
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