A Huge Tax Savings You Can't Miss as Self-Employed
The biggest tax savings many self-employed people miss is business driving. Learn the mileage and vehicle deduction rules for Canada and the US, and how to keep a clean mileage log.
The biggest tax savings many self-employed people miss is business driving.
It gets missed for one reason. The miles happen every day, but the log does not. Then tax season arrives, and people guess. Guessing usually means claiming less than you earned, or having weak records.
Mileage is big because it scales. A few work trips per day becomes thousands of miles or kilometres per year.
Why mileage can be a big deduction
In the United States, the IRS standard mileage rate for 2025 business driving is 70 cents per mile.
If you drive 5,000 business miles in a year, that is $3,500 of deduction under the standard mileage method.
A deduction reduces taxable income. It does not reduce tax dollar-for-dollar. It still matters because it lowers the income you pay tax on.
In Canada, the common approach is different. You usually deduct the business share of your real vehicle costs. CRA explains that you should record total kilometres and business kilometres to get the full benefit of your claim.
Canada basics: business-use percent + vehicle costs
CRA's motor vehicle guidance says to keep a record of total kilometers driven and kilometers driven to earn business income. It also says to list, for each trip, the date, destination, purpose, and number of kilometers, and to record the odometer reading at the start and end of the fiscal period.
A simple way to think about the math:
- business-use percent = business km ÷ total km
- deductible vehicle costs = business-use percent × eligible vehicle costs
Example:
- total km: 20,000
- business km: 12,000
- business-use percent: 60%
- total vehicle costs: $10,000
- deductible amount: about $6,000
The exact eligible costs depend on your situation. The core requirement stays the same. You need kilometres plus receipts.
US basics: standard mileage rate or actual expenses
The IRS lists the standard mileage rates and explains when you can use them. For 2025, business mileage is 70 cents per mile.
The IRS also provides recordkeeping examples, including a daily mileage log format with destination and business purpose.
The mileage log that protects your deduction
A solid mileage log is simple:
- date
- start and end place
- business purpose
- distance
- odometer readings (especially important for Canada, and still useful in the US)
Do not try to rebuild this later. Build it while driving is fresh.
Use MileLog to make the habit stick
MileLog is your mileage tracking app. It is built around the exact steps that make mileage deductions real:
- automatic mileage tracking
- quick trip classification for business vs personal
- tax reports
The App Store listing highlights no account needed, offline-ready, and CarPlay auto-start.
The win is not the app by itself. The win is keeping a complete log all year.
A simple weekly routine
- Let trips get captured automatically
- Classify business vs personal while you remember the trip
- Add a short business purpose when needed
- Export a report monthly or quarterly and store it with your tax documents
Summary
Mileage is a high-impact deduction because it happens every day and adds up fast. Canada focuses on business-use percent with trip details and odometer readings. The US often uses a standard mileage rate or actual expenses, but still needs clear records. Keep the log all year. Mileage becomes one of the cleanest, biggest deductions you can defend.