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Drive a Car?

ImageHere are some tax tips if you use your car for your business or work.

Keep A Journal

Don't just estimate your automobile expenses. At the beginning of the year you should start a journal and record the beginning km Imageon your automobile odometer. At the end of the year you should record the km on your automobile odometer. Thus you will have a total km driven in the year. In your record book you should record the km driven for business with a date destination purpose and km driven. At the end of the year you will know how many km were driven for business purposes.

Don't forget all the components of your automobile expenses are deductible in proportion to the business use. The expenses should be reasonable to the work being done, and include:

  • Gas
  • Oil
  • Insurance
  • Repairs
  • Tires
  • Toll fees
  • Roadside assistance / towing
  • Licence and registration fees
  • Interest on a loan to buy the car
  • Eligible leasing costs
ImageCRA Links: Allowable motor vehicle expenses:
salaried employees, commission employees

Capital cost allowance

Repair costs for an accident that happened while you were driving for business is fully deductible

Automobile Deductions

Automobile expenses are only deductible on self employment income, rental income or if you have an employer who requires you to use your vehicle for work, does not pay all the costs for the related automobile expense  and supplies you with a signed form called T2200 (declaration of conditions of employment)  

The automobile expenses you deduct must be reasonable and related to the use and all the original receipts must be kept to back up the expense.


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