Starting the ATO 12-Week Logbook Mid-Year: Why July Is the Time
The Australian financial year restarted on 1 July 2026, and that is the moment to start a 12-week logbook if your work driving might exceed 5,000 kilometres. Without a valid logbook, your car-expense deduction is capped at the cents-per-km method's 5,000 km x 91c = $4,550 maximum for 2026-27, with no fallback for the kilometres above the cap. Starting the 12-week log in July, while the new year is fresh, is the difference between claiming your full car costs and leaving thousands of deductible kilometres unclaimed.
Why July new-financial-year timing matters
The ATO's cents-per-km method requires no logbook, but it caps the claim at 5,000 business kilometres per car per financial year - a maximum of 5,000 x 0.91 = $4,550 at the 2026-27 rate. If you drive more than 5,000 business kilometres and have not kept a logbook, there is no method available to claim the excess. The kilometres above the cap are simply lost.
The logbook method removes the cap, but it needs a representative 12-week record. If you wait until you have already blown past 5,000 kilometres to start thinking about it, you cannot retrospectively create a contemporaneous log for the months that have already passed. Starting in July means your 12-week period sits early in the year and represents your normal driving pattern, and the resulting business-use percentage applies to the whole 2026-27 year.
The 5,000 km cap is the fallback you are trying to avoid
Think of the $4,550 cents-per-km ceiling as the floor of what a higher-mileage worker can claim, not the target. A tradie, community nurse, rideshare driver, or sales rep who drives 15,000 to 30,000 business kilometres a year is claiming a small fraction of their real car costs if they are stuck on the capped method because no logbook exists.
The 2025-26 rate was 88 cents (a $4,400 cap); for 2026-27 it is 91 cents ($4,550). Either way, the cap bites hard for anyone doing serious business kilometres. The logbook method, which applies your business-use percentage to actual costs with no cap, is the only way past it, and it starts with a decision to log 12 consecutive weeks. Our cents-per-km versus logbook comparison shows the exact point where the logbook overtakes the cap.
How the 12-week logbook works
You log every trip - business and private - for 12 consecutive weeks: date, destination, business purpose, and the kilometres (or odometer readings) for each trip, plus odometer readings at the start and end of the 12 weeks. From that record you calculate your business-use percentage: business kilometres divided by total kilometres over the period.
That percentage is then applied to your actual vehicle costs for the whole financial year - fuel, insurance, registration, servicing, repairs, and depreciation - to give your deduction. The 12 weeks must be representative of your normal driving, so avoid starting during an atypical stretch. A completed logbook stays valid for up to five financial years as long as your driving pattern does not materially change, so the effort in year one pays off for several years. The step-by-step process is on our ATO logbook method guide.
Worked example: what the cap costs you
A sales rep drives 18,000 business kilometres in 2026-27. With no logbook, they are capped at the cents-per-km maximum: 5,000 x 0.91 = $4,550. With a 12-week logbook establishing an 85 percent business-use percentage and total annual car costs of $11,000, the logbook deduction is 11,000 x 0.85 = $9,350.
The difference is $9,350 - $4,550 = $4,800 of additional deduction, available only because a logbook exists. The entire gap comes down to a decision made at the start of the year to keep the 12-week record. Miss that window and the cap is the only option left. The ATO explains the logbook requirements at ato.gov.au.
Start now: what to do this week
Record today's odometer reading as your logbook start. Then log every trip for the next 12 consecutive weeks with date, destination, purpose, and kilometres. The simplest way to stay contemporaneous across a busy schedule is an auto-tracking app that captures each trip automatically and lets you tag the purpose, so the log builds itself rather than depending on memory at day's end.
This is general information about the ATO rules and not personal tax advice. A registered tax agent can confirm which method suits your circumstances, but the one thing that cannot be fixed later is a missing logbook - so if there is any chance you will exceed 5,000 business kilometres, start the 12-week record now.
FAQ
Can I start the ATO logbook part-way through the financial year?
Yes. The 12-week logbook can start at any point in the financial year, as long as the 12 weeks are consecutive and representative of your normal driving. Starting in July, at the start of the new financial year, means the business-use percentage covers the whole year cleanly. What you cannot do is create a logbook retrospectively for weeks that have already passed.
What happens if I do not keep a logbook?
You are limited to the cents-per-km method, which caps at 5,000 business kilometres for a maximum deduction of $4,550 at the 2026-27 rate of 91 cents. Any business kilometres above 5,000 cannot be claimed. For anyone driving well over 5,000 km for work, that is a large amount of unclaimed deduction.
How long is a logbook valid?
Up to five financial years, provided your driving pattern does not materially change. If your work driving changes significantly - a new job, a new territory, or a big shift in business use - you should keep a fresh 12-week logbook to reflect the new pattern.
Do I record private trips in the logbook too?
Yes. The logbook records every trip, business and private, for the 12 weeks, because the business-use percentage is business kilometres divided by total kilometres. You need both numbers to calculate the percentage the ATO expects.
More Australia guides
ATO Cents-per-km Rate 2025-26: 88¢/km, 5,000 km Cap
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ATO Cents-per-km Rate History
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ATO Logbook Method: 12-Week Guide
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Cents-per-km vs Logbook: Which Saves More?
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How to Claim Car Expenses on myTax
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ATO Car Expenses for Food Delivery Drivers (2025-26)
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