Tax Tip - Review your personal use of employer-provided automobiles

August 30, 2019


If you have an employer-provided automobile, the availability of the car is considered a taxable benefit to you, and a standby charge and an operating cost benefit will be included in your income. If your total personal driving is less than 20,004 kilometres in a year, and represents less than 50% of total use, you may qualify for a reduction of the standby charge. Also, if your business driving exceeds 50% of total kilometres, you can calculate your operating cost benefit as one-half of the standby charge, less reimbursements, if this is beneficial.

Review your automobile log to see if you're close to these thresholds. If so, you may want to reduce personal travel with the company car where possible between now and December 31 to reduce your taxable benefits. Also, if you intend to use the alternate 50% method for calculating the operating benefit, you must advise your employer in writing by December 31.

For more information, click here to read our bulletin Automobile Expenses & Recordkeeping. Your BDO tax advisor is ready to help.

This tax tip is a publication of BDO Canada LLP on developments in the area of taxation. This material is general in nature and should not be relied upon to replace the requirement for specific professional advice. The information in this tax tip is current as of August 9, 2019.

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