Auto Deductions

Auto Deductions

The 2019 automobiles expense deduction limits and prescribed rates for determining the taxable benefit on automobile operating expenses are as follows:

  • The ceiling on the capital cost of passenger vehicles for capital cost allowance purposes is $30,000 (plus applicable federal and provincial sales taxes). Eligible zero-emission vehicles have a $55,000 limit, plus sales tax.
  • The limit on deductible leased costs is $800 per month (plus applicable federal and provincial sales taxes).
  • The limit on tax-exempt allowances paid by employers to employees is $0.58 per kilometer for the first 5,000 kilometers driven and $0.52 for additional kilometers (for Yukon, the Northwest Territories and Nunavut, $0.62 per kilometer for the first 5,000 kilometers driven and $0.56 for additional kilometers).
  • The maximum allowable interest deductions for amounts borrowed to purchase an automobile is $300 per month.
  • The general prescribed rate used to determine taxable benefit relating to the personal use of automobile paid by employers is $0.28 per kilometer (for taxpayers employed principally in selling or leasing automobiles, $0.25 per kilometer).

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