Motor Vehicle Expenses

Updated: 2020-05-15

Use the Motor Vehicle worksheet to enter details of vehicle expense and associate them with an income statement (T776, T2125, T2121, T2042, T1163) or employment expenses claim (T777WS).

When to use a Motor Vehicle worksheet

As a general guideline, if the motor vehicle was used for both personal and business use, use the Motor Vehicle worksheet to calculate the business-use portion of the expenses. If the vehicle was used 100% for the business, you may enter the expenses directly on the income statement.

Completing the Motor Vehicle worksheet

1. Before creating a Motor Vehicle worksheet, first create the statement with which you want to associate the expenses. This adds them to the worksheet so you can allocate the kilometrage accordingly. See the Income statements and Rental statements help topics.
2. Create a separate Motor Vehicle worksheet for each vehicle. Enter the make, model and year of the vehicle at the top of the worksheet. This creates a new motor vehicle item in the Prepare forms list and allows you to quickly find (F4) the vehicle by typing the make or model.
3. Enter the total kilometres driven during the year.
4. If the vehicle expenses also apply to the spouse’s return, check the box to show the motor vehicle details on his or her return.
5. Allocate a portion of the kilometres driven to a statement. When there is more than one income or expense statement in the return, they all appear on the worksheet, making it possible to share kilometrage between them. Ensure the total allocated kilometres does not exceed the total kilometres driven in the year.
   
6. Enter fuel, maintenance and other expenses in the Details of motor vehicle expenses table. If eligible, split expenses that qualify for the GST/HST rebate into separate columns.
   
7. Scroll down to Chart 1 calculate loan interest.
   
8. Scroll down to Chart 2 to calculation leasing costs.
   
9. Scroll down to Chart 3 to calculate CCA. Calculated amounts flow back up to the related lines in the expenses table and then to the income or expense statement. For any current-year additions, be sure to enter the acquisition date.
10. If addition was before November 21, 2018, the addition is not eligible for the accelerated CCA. If the date is after November 20, 2018, TaxCycle will automatically answer Yes to the Eligible for accelerated CCA? question and trigger the accelerated CCA calculations. 
11. Rows in the Net addition calculation table show the calculation of the accelerated CCA when applicable. Please read the Accelerated CCA help topic for further details on this measure and the calculations in TaxCycle.