Vehicle Business Expense Deduction Canada 2025

Vehicle Deduction Calculator — 2025 CRA Rates

Calculate your vehicle deduction using either the CRA per-km rate or the actual expense method.

Business Kilometres Driven

Total Kilometres Driven (all purposes)

Actual Annual Vehicle Expenses (for actual expense method):

Fuel ($)

Insurance ($)

Maintenance & Repairs ($)

Lease Payments or CCA ($)

Interest on Auto Loan ($)

Parking (business only) ($)

Track Business Expenses with KOHO

Keep a separate KOHO account for business expenses — makes tax time dramatically easier. Every vehicle expense auto-categorized. Use code 45ET55JSYA for a sign-up bonus.

Open KOHO — Code: 45ET55JSYA

CRA Vehicle Deduction Rates for 2025

CRA publishes per-kilometre rates for employees and self-employed individuals who use their personal vehicle for business:

Province/Territory	First 5,000 km	Each km after
Provinces (general)	$0.72	$0.66
Yukon, NWT, Nunavut	$0.76	$0.70

These rates are for 2025. The simplified per-km method does not require tracking actual expenses — just a mileage log. However, it is only available for employees claiming on a T2200. Self-employed individuals use the actual expense method.

CRA Mileage Log Requirements

CRA requires a logbook for all vehicle deduction claims. Your log must record:

Date of each business trip
Destination and purpose of the trip
Starting and ending odometer readings (or total kilometres for the trip)
Name of client or business reason
Total kilometres driven for the year (to calculate business-use percentage)

CRA also accepts a logbook for a "representative period" — 3 consecutive months — which can be used to establish a business-use percentage that is then applied to the full year. This can be done once every five years provided usage patterns don't change significantly.

Apps like MileIQ, TripLog, or Google Timeline make maintaining a CRA-compliant log effortless with automatic trip detection.

What Qualifies as Business Use?

Travel to meet clients, customers, or prospects (not your regular workplace)
Travel between two different places of work (e.g., multiple job sites)
Travel for business errands — picking up supplies, bank deposits, courier runs
Travel to a temporary work location away from your usual workplace

Does NOT qualify:

Commuting from home to your regular place of employment — this is never deductible
Personal trips or mixed-purpose trips where business is incidental
Travel between home and a regular office location

Vehicle Deduction Calculator — 2025 CRA Rates

Track Business Expenses with KOHO

CRA Vehicle Deduction Rates for 2025

CRA Mileage Log Requirements

What Qualifies as Business Use?

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