For passenger vehicles purchased on or after January 1, 2025, the maximum limit for capital cost allowance increased to $38,000. Previously, the maximum limit was $37,000 for passenger vehicles purchased in 2024, $36,000 if purchased in 2023, $34,000 if purchased in 2022, and $30,000 if purchased prior to 2022.
For passenger vehicles newly leased on or after January 1, 2025, the maximum deductible amount increased to $1,100 per month before GST/HST. Previously, the maximum deductible amount was $1,050 per month for passenger vehicles newly leased in 2024, $950 per month if lease started in 2023, $900 if lease started in 2022, and $800 per month for leases that started prior to 2022.
For zero-emission passenger vehicles purchased on or after January 1, 2023, the maximum limit for capital cost allowance is $61,000. Previously, the maximum limit was $59,000 if purchased in 2022, and $54,000 if purchased prior to 2022.
The mileage allowance rates considered reasonable for employers to reimburse employees for business use of their personal vehicle increased on January 1, 2025 to $0.72 per km for the first 5,000km, and to $0.66 for every km thereafter. In the previous year 2024, it was $0.70 per km for the first 5,000km, and $0.64 for every km thereafter.
The above information is of a general nature only and should not be relied upon for specific situations. Call Marlies Y Hendricks, CPA at 416-766-3941 or submit email enquiry form below to set up a consultation.
