The Department of Finance Canada has announced the income tax deduction limits and expense benefit rates that will apply in 2018 when using an automobile for business purposes.
There are two notable changes taking effect as of 2018:
- "The limit on the deduction of tax-exempt allowances that are paid by employers to employees who use their personal vehicle for business purposes for 2018 will be increased by 1 cent to 55 cents per kilometre for the first 5,000 kilometres driven, and to 49 cents per kilometre for each additional kilometre."
- "The general prescribed rate that is used to determine the taxable benefit of employees relating to the personal portion of automobile operating expenses paid by their employers will also accordingly be increased by 1 cent to 26 cents per kilometre. For taxpayers who are employed principally in selling or leasing automobiles, the prescribed rate used to determine the employee's taxable benefit will be increased by 1 cent to 23 cents per kilometre."
For further details, see the Government's announcement.
The information contained in this publication is of a general nature and is not intended to address the circumstances of any particular individual or entity.
Accordingly, the information provided herein should not be used as a substitute for consultation with professional tax, accounting, legal, or other competent advisers.
While we endeavour to provide accurate and timely information, there can be no guarantee that such information is accurate as of the date it is received or that it will continue to be accurate in the future.
Again, no one should act upon any information contained herein without seeking appropriate professional advice after a thorough examination of their particular situation.
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