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Robert109
March 22, 2020
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Recording Mileage for both Business and Personal Use of Vehicle

  • March 22, 2020
  • 1 reply
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I am new to recording mileage into QuickBooks. I currently track mileage by a spreadsheet. I would like to begin using QuickBooks to track mileage, however, I do not see how to record the mileage for the personal use of the vehicle. Would I create a customer, in my name and if so, can I pay the taxes on this fringe benefit through payroll by tieing the use of the vehicle into payroll?

    Best answer by GlinetteC

    Thanks for reaching out to us here, DAN123.

     

    I'd like to provide you insights on recording mileage for personal use in QuickBooks Desktop.

     

    I've got two options on how to record this in the system. We can either use the class tracking feature or create a different expense account for it. Let's make sure to turn on the class tracking option in QBDT. Here's how:

    1. From the Edit menu, select Preferences.
    2. Select Accounting and go to the Company Preferences tab.
    3. Select the Use class tracking for transactions checkbox.
    4. Select OK.

    To set up class:

    1. From the Lists menu, select Class Lists.
    2. Select New from the Class drop-down menu.
    3. Enter the class name and click OK.

    To create a different expense account:

    1. From the Accountant menu, select Chart of Accounts.
    2. From the Account drop-down menu, select New.
    3. Select Expense and click Continue.

    The instructions should allow you to track mileage for personal use.

     

    Keep me posted if you need anything else.

    1 reply

    G
    GlinetteCAnswer
    March 22, 2020

    Thanks for reaching out to us here, DAN123.

     

    I'd like to provide you insights on recording mileage for personal use in QuickBooks Desktop.

     

    I've got two options on how to record this in the system. We can either use the class tracking feature or create a different expense account for it. Let's make sure to turn on the class tracking option in QBDT. Here's how:

    1. From the Edit menu, select Preferences.
    2. Select Accounting and go to the Company Preferences tab.
    3. Select the Use class tracking for transactions checkbox.
    4. Select OK.

    To set up class:

    1. From the Lists menu, select Class Lists.
    2. Select New from the Class drop-down menu.
    3. Enter the class name and click OK.

    To create a different expense account:

    1. From the Accountant menu, select Chart of Accounts.
    2. From the Account drop-down menu, select New.
    3. Select Expense and click Continue.

    The instructions should allow you to track mileage for personal use.

     

    Keep me posted if you need anything else.

    R
    Robert109Author
    March 22, 2020

    Thank you. I like the class tracking feature because I already use class tracking. However, will this allow me to track the vehicle use during payroll each period?

    KlentB
    KlentB
    March 22, 2020

    You can track your mileage in QuickBooks Desktop, DAN123.

     

    Entering your mileage allows you to account for the entire cost of owning and using your company vehicle including fuel, maintenance, and registration costs. By tracking your mileage, you can properly estimate the total cost for a job and bill your customers accordingly. I'll guide you in doing the whole process:

     

    1. Select the Company from the top menu bar.
    2. Choose Enter Vehicle Mileage. 
    3. Select the Vehicle List, then click New. 
    4. Enter a name for the vehicle (you can use the model, year of the car, license plate number or any other vehicle specific information). 
    5. Hit OK to add the vehicle.

     

    Since you've mentioned that you want to the taxes of fringe benefit through payroll, We can either create taxable fringe benefits payroll items to handle that transaction. 

     

    Here's how to set up a taxable fringe benefit payroll item:

    1. Select Lists from the top menu bar, then choose Payroll Item List.
    2. Click the Payroll Item button, then select New.
    3. Choose Custom Setup.
    4. Select either Company Contribution or Addition, and select Next.
      • Company Contribution: Adds the value of the fringe to be taxed but does not increase net pay
      • Addition: Adds the value of the fringe to be taxed and increases net pay
    5. Enter a name for this item, then click Next.
    6. Select an Expense account and Liability account from the drop-down lists, then hit Next.
    7. From the Tax Tracking Type drop-down list, select Fringe Benefits and select Next.
    8. Select Next twice (to bypass the Calculate based on quantity window).
    9. Enter that default rate in the first section of the Default rate and limit window if the benefit will be a specific amount.
    10. Enter the amount of any limits on the item in the second section of the window.
    11. Click Finish to complete the process.

    If the amount will be included on a paycheck with regular wages to offset the taxes, we can enter the amount using the Fringe Benefit payroll item, under Other Payroll Items. We'll also have to take note that no other deductions should be added as the amount is not added to the net check, and only taxes are calculated.

     

    If you reimburse the mileage, you can refer to this article in doing it: Create a non-taxable reimbursement payroll item.

     

    Although, you can still use the class tracking to represent the vehicle or add a class for each vehicle but it won't be directly associated with tracking of your fringe benefits.

     

    As always, we're open 24/7 to help you. You can always mentioned me in your post if you further assistance in managing your mileage and taxes.

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