Is an employee's business use of a company car a working condition fringe benefit?

Author: Alice Gilman

Yes. To qualify as a working condition fringe benefit, an employee must substantiate his or her business use of a company vehicle through adequate records or by sufficient evidence that corroborates his or her own statements. An employee need not keep a contemporaneous log, but written records made close to when the employee incurs expenses are the most persuasive. An employee must keep receipts and an account book, diary, log, statement of expense, trip sheets and similar records that prove these elements:

  • The time and place of the travel;
  • The business purpose of the travel; and
  • The business relationship to the individuals with whom the employee met.