Vehicle Expense Calculator

Claiming Vehicle Expenses in Canada

If you use your personal vehicle for business, you can deduct the business-use portion of your vehicle expenses. The key is calculating what percentage of your total driving is for business purposes.

To determine your business-use percentage, divide your business kilometers by your total kilometers for the year. If you drove 20,000 kilometers total and 12,000 were for business, your business-use percentage is 60%. This percentage applies to most vehicle expenses including fuel, insurance, maintenance, and depreciation.

Expenses that can be prorated by business use include fuel, insurance, license and registration fees, maintenance and repairs, car washes, loan interest (capped at $300/month), lease payments (capped at approximately $1,050/month), and CCA (depreciation). Parking and tolls incurred specifically for business purposes can be deducted at 100%.

For vehicles you own, you claim Capital Cost Allowance instead of the actual depreciation. Most passenger vehicles fall into Class 10 (30% declining balance). Vehicles costing more than approximately $37,000 plus tax go into Class 10.1, which limits the depreciable amount. Zero-emission vehicles currently qualify for enhanced CCA rates.

The CRA prescribes per-kilometer rates ($0.72 for the first 5,000 km and $0.66 thereafter in 2025) primarily for employer reimbursements. Self-employed individuals typically use the actual expense method, but comparing both can help you understand your true vehicle costs.