Auto Insurance Deductible Portion

[Python0608]

I drive UberEats as side gig and am tracking expenses. But I’m a bit hesitant about how to track auto insurance cost. I paid insurance premium every 6 months on April and October. So this year from January to April, should I divide last October’s payment by 6 and track 4 of them? Or do I just track the payment that would be made in April and October this year?

[MinhT1 · Accepted solution]

As you are on a cash basis, if you are using the actual cost method for your vehicle costs, then you count insurance as an expense when you pay it.

For example, for the year 2020, count all premiums paid in the year 2020. You can have to apportion it between the business use and the personal use portion of your vehicle.

[Python0608]

@MinhT1 Thanks for quick reply. Count the expenses as they occur does seem to be the easiest approach. But this way, does it make sense that apportion business use (from January to April) from payments for May to next April since insurance is normally prepaid?

[MinhT1]

As you are on cash basis, there is no need to apportion expenses by month. Count them when you actually pay them.