Various automobile deductions and taxable benefit rates are limited to amounts prescribed by the Department of Finance annually.
On December 18, 2023, the 2024 limits were announced as follows:
- The limit on the deduction for non-taxable allowances paid by an employer to an employee using a personal vehicle for business purposes will increase in 2024 by 2 cents to 70 cents/km for the first 5,000 km driven and to 64 cents for each additional km. For Yukon, the Northwest Territories and Nunavut, the tax-exempt allowance will continue to be 4 cents/km higher, which is 74 cents for the first 5,000 km driven and 68 cents for each additional km.
- The ceiling on the capital cost for CCA of most passenger vehicles will increase to $37,000 from $36,000, and the limit for zero-emission passenger vehicles will remain at $61,000.
- The limit on leasing costs will increase to $1,050/month (from $950/month) for new leases entered into on or after January 1, 2024.
- The maximum allowable interest will increase to $350/month (from $300/month) for new loans entered into on or after January 1, 2024.
The general prescribed rate used to determine the taxable benefit relating to the personal portion of automobile operating expenses paid by employers will remain at 33 cents/km. For taxpayers employed principally in selling or leasing automobiles, the rate will remain at 30 cents/km
- Action: Compare automobile allowances and other payments made against the limits to determine whether expenditures that do not reduce tax are being made.
If you have any questions regarding 2024 Limits Released in Canada, feel free to contact finnection via email at info@finnection.ca or call us at (647) 795-5462
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