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Vehicle Expense Calculator

2025
Vehicle Details
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Deduction Summary

Estimated Tax Savings

$2,170.38

Total Vehicle Deduction

$7,320.00

Business Use

60.0%

Expense Breakdown
CategoryTotalDeductible (60%)
Fuel$4,500.00$2,700.00
Insurance$2,400.00$1,440.00
Maintenance$1,500.00$900.00
Loan Interest$800.00$480.00
CCA$3,000.00$1,800.00
Total$12,200.00$7,320.00
CRA Mileage Rate Comparison

Actual Expense Method

$7,320.00

CRA Mileage Rate

$10,200.00

Better
First 5,000 km @ $0.72/km$3,600.00
Remaining 10,000 km @ $0.66/km$6,600.00
Total Mileage Allowance$10,200.00
Understanding Vehicle Deductions in Canada

CRA rules for claiming business vehicle expenses

CRA allows two methods for self-employed vehicle deductions: (1) Actual expenses — track all vehicle costs and deduct the business-use percentage; (2) Simplified mileage rate — for employees, employers may reimburse at $0.72/km for the first 5,000 km and $0.66/km thereafter (2025 rates). Self-employed individuals typically use the actual expense method on Form T2125.
CRA requires a vehicle logbook to substantiate business-use percentage. Record the date, destination, purpose, and distance of each business trip. Keep the logbook for at least one complete year to establish a base year. In subsequent years, a three-month sample period may be acceptable if your driving pattern is consistent.
Class 10 applies to vehicles costing $37,000 or less (before tax). Class 10.1 applies to passenger vehicles costing more than $37,000 — the CCA is limited to the $37,000 threshold. Both have a 30% declining balance CCA rate. Class 10.1 vehicles are each treated as a separate class, so no terminal loss or recapture applies on disposition.
For 2025, the CCA limit for a passenger vehicle (Class 10.1) is $37,000 plus applicable sales tax. This means if you buy a $60,000 vehicle, you can only claim CCA on $37,000. Leasing costs are also limited: maximum monthly deduction is $1,050 for leases entered in 2025, and interest on vehicle loans is capped at $300/month.
Yes, business-related parking fees and bridge/highway tolls are fully deductible (100%, not limited by the business-use percentage for the vehicle itself). Personal parking and commuting costs are not deductible. Keep receipts for all parking and toll charges.
If you lease a vehicle for business, the deductible portion is limited. For 2025, the maximum monthly lease payment you can claim is $1,050. If the vehicle manufacturer's list price exceeds $62,000, additional restrictions apply. The deduction is further prorated by your business-use percentage.
Zero-emission vehicles (electric, hydrogen fuel cell) qualify for enhanced CCA rates. Class 54 provides a 100% first-year CCA deduction for vehicles up to $61,000 (passenger vehicles). Class 55 provides enhanced rates for larger zero-emission vehicles. These incentives are being phased down starting in 2024.

CRA-Aligned: Mileage rates ($0.72 and $0.66/km) are CRA prescribed rates for 2025. CCA Class 10/10.1 limits and vehicle cost caps apply. Keep a detailed logbook. Consult a tax professional for personalised advice.

More Information

Disclaimer: This calculator provides estimates based on current CRA rates and thresholds for the 2025 tax year. It does not constitute professional tax, financial, or legal advice. Your actual liability may differ depending on your individual circumstances. Always consult a qualified accountant before making financial decisions. Read our terms

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