How to deduct vehicle expenses

You can deduct expenses you incur to run a motor vehicle you use to earn business income, employment income, or rental income.

If your business is a sole proprietorship, you claim your vehicle expenses at line 9281 of Form T2125.

If you are a partner in a business partnership, you claim your vehicle expenses at line 9943 of Form T2125.

If your run your business in the form of corporation, you can have your business reimburse you the vehicle expense you incur for the business through the use of your personal vehicle. 

If you are required by your employment contract to use your vehicle in your employment, you can claim the vehicle expense at line 9281 of Form T777.

Under certain conditions, you can claim reasonable vehicle expense incurred to earn rental income. The expense is claimed at line 9281 of Form T776.

All of Form T2125, Form T776, and Form T777 include a work chart to help you calculate the amount of motor vehicle expenses you can deduct.

What types of automobile expenses are tax deductible?

Additional information