Payroll Tips

The Department of Finance confirmed the automobile expense deduction limits and the prescribed rates for the automobile operating expense benefit that will apply in 2012 will be increased as follows:

 

• The limit on the deduction of tax-exempt allowances paid by employers to employees using their personal vehicle for business purposes for 2012 will be increased by .01 from 52 to 53 cents per kilometre for the first 5,000 kilometres driven and from 46 to 47 cents for each additional kilometre.
• For the Yukon Terrirory, Northwest Territories and Nunavut, the tax-exempt alowance will increase from 56 to 57 cents for the first 5,000 kilometres driven and from 50 to 51 cents for each additional kilometre.
• In addition, the general prescribed rate used to determine the taxable benefit relating to the personal portion of automobile operating expenses paid by employers for 2012 will increase by 2 cents from 24 to 26 cents per kilometre.  For employees employed principally in selling or leasing automobiles, the prescribed rate will increase by 2 cents from 21 to 23 cents per kilometre.

 

Payroll Tip Courtesy of The Canadian Payroll Association

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~Wages Payroll