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#Cents per kilometre 2015 full

Reasonable per-kilometre rateĪs a rule, the per-kilometre rate we consider reasonable is the rate that an employer subject to income tax is authorized to deduct under Québec tax laws and regulations.

#Cents per kilometre 2015 full

However, if the allowance is not reasonable, you must include the full amount of the allowance in boxes A, G, I and L of the employee's RL-1 slip (see courtesy translation RL-1-T). Therefore, if the allowance you pay an employee for the use of a motor vehicle is reasonable, it does not have to be included on the RL-1 slip, as this allowance is not taxable.

You do not pay an allowance and also reimburse the employee for some or all of the expenses related to the use of the vehicle, unless the reimbursement is for supplementary business insurance, tolls or ferry charges not covered by the allowance.

The allowance is calculated solely on the basis of the actual number of kilometres the vehicle is used by the employee in the performance of his or her duties.

By seeking your accountant’s assistance in completing your tax return, you can ultimately reduce your tax liability and increase your refund.An allowance received by an employee for the use of a motor vehicle is taxable unless it is considered a reasonable allowance.Īn allowance is considered reasonable if the following conditions are met: The method which gives rise to the highest amount will be used in your tax return as a motor vehicle deduction. The four methods above will be used by your accountant based on the records you provide. You will be required to provide written evidence of your vehicle expenses as per the log book method above. This method allows you to claim 1/3 of the total actual car expenses you used for the year.

This logbook will last for a five year period but you must still support the percentage claimed. Fuel expenses may not be required if the total kilometres travelled can reasonably be estimated within a financial year. Depreciation on the cost of the vehicle is also allowed (up to the luxury car limit as per the 12% of cost method). You must be able to prove your vehicle expenses such as registration, insurance, interest and maintenance. A work related percentage can then be calculated and applied to your vehicle expenses. This logbook requires you to record your odometer readings, kilometres driven for work purposes and total amount of kilometres driven during this period. (Trap: the 12 week period should be a period which is average not necessarily the first day you buy it). To use this method, you must keep a logbook for a continuous 12 week period in the first year of business use. If you travel above 5000 kilometres, this method may give rise to the most attractive deduction. To claim this method, you will need to show proof of purchase/lease which states the date and original cost.

The maximum you can claim is 12% of the luxury car limit in the year you purchased or leased it. If you lease a car, you can claim 12% of the market value at the time it was first leased. If you purchased a car, you can claim 12% of the cost. As per the cents per kilometre method, you need to substantiate your business use. This method can be used if your vehicle is a high cost vehicle. A rate provided by the ATO will then be applied to the total kilometres on the basis of your vehicles engine size. However, you do need to show an estimated calculation of your work travel. To claim this method, you do not need to substantiate it with written evidence. This method can be used to claim a maximum of 5000 kilometres. (Trap: simple but can be far less than what you are entitled to claim) The following 4 methods to claim your motor vehicle expenses and increase your refund will be used to help calculate which method will give you the highest deduction.

There is a common misconception of what you can claim, how you can claim it and what records you need to keep. Do you perform errands from your workplace in your own vehicle? Do you use your car to carry bulky work tools and equipment and can’t store them safely at your workplace? Do you travel from different job sites each day? These are the types of questions that tax agents will ask to help assist you in claiming a tax deduction for your motor vehicle.