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Training For Success With Your Internet Business, Article 6, Motor Vehicle Expenses

As a home business owner, you may deduct the cost of driving in the course of your home based business, including trips to business meetings or seminars, to entertain clients outside your home, to pick up products and office supplies, to make deliveries, and to do business banking.
If you are engaged in a network marketing business or an MLM Business, the cost of visiting prospective clients and persons (Leads) you would like to recruit into your sales organization is deductible, even if you are not successful in your recruiting efforts.

If your home-based business is your only employment, all of your driving to and from your home office, which is your principal place of business, and different locations where you are actually involved in carrying on your business, is deductible. But if you are also employed elsewhere, as an employee, figuring your deductible business mileage is slightly more complicated. The reason being that commuting between your home and place of work is normally considered a personal expense and is not deductible as a business expense.

In order to deduct business mileage as a home office business expense, you must show that your home is your principal place of business. Your principal place of business is where you regularly meet with clients or customers, where your more important work is done, or where you spend most of your time. The cost of going from your home office to a related business location is deductible, even if your home office is the site of a secondary business or job. For example, driving from home to the bank to deposit business checks provides mileage that is deductible as a business expense.

Where a home-based business is only worked part time, be sure to conduct business in your home before going to a related business location, such as the bank above, or you will risk losing the deduction. Keep a daily record of your business activities at home to prove you were traveling between two business locations on that day.

Computing your auto expense.
There are two methods of computing your automobile expense:
the mileage rate or
the actual expenses method.

You may use either method to calculate your costs. You will, obviously, want to use the method that gives you the higher deduction.

Mileage rate. You may deduct a certain amount (this is an amount provided for by the tax legislation in the country in which you are carrying on your home based business) per mile for business driving. If you use this method, you must combine the mileage for all cars driven for the same business. If you use the mileage rate, you may additionally, usually deduct parking fees and tolls.

Actual expenses method. Alternately, you may deduct the business portion of the expenses of operating your car, such as gas, oil, repairs, insurance, car washes, tires, auto loan interest and depreciation, if you purchased the vehicle or lease costs if the vehicle is being leased.
Generally, if you buy a new car during the year, the actual expenses method will exceed the mileage rate method. This presumes, of course, that you keep complete records of your expenses throughout the year. If not, you should use the mileage rate instead. Only expenses attributable to your business use of the car are deductible.

This means you must allocate your operating costs and depreciation according to your percentage of business use. Usually, parking fees and tolls do not have to be allocated, however.
To calculate Motor Vehicle Expenses you will need to record and have available the following information:

Total distance driven in year.

Total distance driven during year for business purposes. ( You would be well advised to keep a logbook to record this information on a regular basis.)

If you receive any reimbursement and or allowance for using your motor vehicle, and it is not included in your income, you must deduct this amount from any claim that you make.

Fuel Costs,
Repairs & Maintenance,
Lease Payments if Vehicle is Leased,
Copy of Lease if Vehicle is Leased,
Vehicle Washes,
Licence and Registration,
Parking Costs and tolls,
If Vehicle is owned, Make, Model & Year of Vehicle,
Year of Purchase of Vehicle,
Cost of Vehicle,
Interest on money borrowed to purchase vehicle,

Note: Taxation legislation differs between countries and each country may change their rules at any time. The information provided in these newsletters is accurate at time of publication. You should however seek specific information from your Tax Advisor or Taxation Department as it relates to your own situation each year that you are required to provide Income and Expense Statements.

Other topics in this series are as follows:

Number 1, Record Keeping,
Number 2, General Expenses,
Number 3, Purchase of Goods for Resale,
Number 4, Deductions for use of Home,
Number 5, Entertainment Expenses,
Number 7, Depreciation Costs,
Number 8, Business Meals,
Number 9, Salary Payments to Children,
Number 10, Travel Expenses,
Number 11, Demonstrators Samples & Promotional Tools,
Number 12, Gifts,
Number 13, Here Comes the Tax Man,
Number 14, Capital Items

Maximizing Your Business Credit Card’s Potential

Some people believe that business credit cards are not necessary for a business at all. However, although many successful businesses in the past were able to get by without business credit cards, this doesn’t mean entrepreneurs today should pass on the opportunity of getting one.

It is true that the incorrect use of business credit cards can cause serious debt problems but if you know how to handle your credit card responsibly, then surely you and your business can benefit from the flexibility and conveniences that business credit cards bring. In this article, let’s focus on the advantages of small business credit cards and how you can use them to their full potential:

Keeps Your Cash Flow Steady. Every business is confronted with the challenge of keeping up with daily expenses. There may be times when your petty cash isn’t enough to cover for everything. On these occasions, having a business credit card on hand is indispensable. When unexpected expenses arise, you can simply charge them on your card and pay at a later time. Nevertheless, don’t take this as an opportunity to spend more than what you can afford. Although a business credit card can cover some of your operating costs, make sure that you can pay back your charges on time.

Build-up Your Business Credit. Building your business credit history is definitely easier with the help of credit cards. Bear in mind that building good credit and maintaining an excellent credit status depends on your timelines of submitting your credit card payments. Furthermore, you should also pay attention on how much of your credit limit is used. Ideally, to keep a high credit score, you should not exceed more than 50% of your allotted credit.

Track Your Business Spending. Even with the use of business accounting software, having a business credit card is another way to easily monitor your accounts. Monthly billing statements as well as quarterly and yearly account summaries from your credit card company can be used as references to your accounting particularly when filing your business taxes.

Account summaries present an itemized and detailed record of all purchases you’ve made for the past year. If you’re a home based business owner, you can easily determine which of your purchases are tax deductible and which ones are not. You can even find business credit cards that offer downloadable account summaries so you can use them along with your accounting software.

Get rewarded from your credit card spending. A lot of business credit cards in the market offer rewards. You can find a wide variety of credit card rewards programs that are especially created to meet the needs of small business owners. Since businesses generally spend a lot on their operations, they also have more opportunity to earn bigger rewards at a faster rate than personal credit card holders. By choosing a business reward credit card that complements your business’s spending, you can certainly get more from a reward business credit card.

How to Promote an Office Cleaning Business

If you are thinking about starting up your own janitorial/ cleaning business, here are some low-cost promotional strategies & techniques you can use to get accounts for your office cleaning business.

Starting an office cleaning business is simple, and requires little start-up capital. For the most part, the only expense involves buying supplies and advertising.

Fortunately, cleaning supplies are cheap, and it costs even less to advertise in local newspapers, or online. Because most business professionals are busy, they are willing to pay a company or individual to clean their offices. You just need to learn how to brand your Office cleaning company in order to grow your business.

Remember, Almost anyone can clean. The trick is to hire others to do all the cleaning once you get things up and running. This leaves you free to generate new business. There are very simple and inexpensive ways to market your office cleaning accounts.

Here are just a few simple ways:

* Specialized Service:

If you offer your cleaning service for just one type of business.. let’s say , lawyer’s offices, by concentrating all your efforts in one type of clients, it will make your life easier, and your efforts far more better than being everything for everyone. Think about this, if a lawyer compares between 2 companies, company A is a general commercial cleaning company that offers service for all type of businesses, and company B specializes in just lawyer offices. Who would he choose?

By specializing in one or few types of service you give a message that you offer a service tailored for their needs,and that’s exactly what loyal clients want. Try to copy this idea by finding a small niche, like Doctor’s offices, dental offices, pharmacies, Real Estate, High Tech offices, etc..

Don’t misunderstand me here. You can still go after any type of offices to clean. But you can tailor your marketing towards each individual type of industry. In other words..You can have specialized services in many different industries.


One marketing strategy used by office cleaning business owners are giveaways”. Businesses love to try services for free. Once they see what a good job you do, and once you earn their trust, there’s a good chance you have just earned a client. If you’re running a cleaning business, you could give away a cleaning tips brochure, free cleaning guides, or color swatches. Once you begin giving away authoritative information customers will begin to perceive you as an expert in your field. (This may seem somewhat difficult and time consuming but I promise you it’s not).

* Business Cards:

This is one of the greatest marketing tool for any Janitorial/office cleaning business. The problem is most folks that are new to the office cleaning business don’t know how to do this correctly. If you know how to get your business card into the hands of the right people, at the right time you will generate a ton of business just from this one little strategy alone.

Simply learn how to Provide an irresistible offer on the back of the card for new clients. This has worked for office cleaning business owners many times over!

You don’t have to hand out 200 business cards and hope for the best. There are methods of getting leads that can actually help you obtain more business than if you were running an expensive full-page advertisement in the phone book!

* Print Advertising:

Start by setting an advertising budget. Once you set your budget, decide where to advertise. For a cleaning business it makes no sense and would be a waste of your money to advertise in a large magazine or buy a TV commercial that airs on a Saturday night. Besides being expensive, these ads will most likely not reach your target audience. The common print ad, run in your local newspaper or shopper, is the most basic unit of advertising.

Print ads have launched major office cleaning companies and created many success stories. Running ads in a local paper can be a great way to promote your cleaning business…but you must follow a few basic rules.

Your ad should attract attention! Although this sounds obvious, unless your ad attracts attention you are throwing your money down the drain. The most compelling way to have a “noticeable” ad is to have an interesting and visually appealing headline. If you are designing a large ad, think of using a subhead. This will provide added information and can be longer than the headline.

* Greeting Cards:

Greeting cards can be used as a great Marketing Tool when it comes to repeat business and referrals. Use them to thank clients for their business. Send them as greeting for most of the holiday occasions. Try to send cards as early as possible so they can be the first in your clients mailbox. Surprise them first so they can always remember you. Use handwritten messages to show more appreciation to your customers. If you use this marketing tool,you can always save money by buying cards after occasions, in quantity and keep them for next year.

* Electronic Media:

Buy banner ads in electronic media. Look for websites that target your potential customers, such as your local chamber. This can deliver your information right to the business that needs your service.

Copyright (c) 2008 Brent Wale