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Pilsner12 · 06-17-2011, 01:18 PM

I know tax questions have been asked here in the past and I did a quick search and didn't see one that asked this question.

I am a commissioned employee who is required to spend about 90% of my time out of the office. For use of my vehicle I am paid a car allowance of $0.40/km.
The current reasonable rate in Alberta for under 5,000km a year is $0.52/km and $0.46/km for over 5,000km a year.

Last year I had 22,000km of business travel.

When I was filing my return I was told that I could not claim my car expenses because I received a reasonable allowance. To me this does not make sense when:
1.) The province has a posted reasonable rate that my allowance is under.
2.) After maintenance on the car, gas insurance and registration there is not much left to cover the wear and tear of my vehicle. I estimate the difference is approximately $600-$800 from what I was paid to what my car cost me to operate for work.

I called Revenue Canada for an explanation and the person I spoke to said he was aware of the forms that I was talking about and validated my understanding of the "rules" but when I asked him to determine what would be considered an unreasonable amount he said there was no such thing and any amount paid by the employer is viewed as reasonable in their eyes.

By that logic my employer could pay me $10 annually for use of my vehicle and in the eyes of the government it would be reasonable.

Am I understanding this correct or am I able to claim the discrepancy amount as an expense?

06-17-2011, 01:18 PM	#1
Pilsner12 Crash and Bang Winger Join Date: Mar 2002 Exp:	Income Tax T2200 I know tax questions have been asked here in the past and I did a quick search and didn't see one that asked this question. I am a commissioned employee who is required to spend about 90% of my time out of the office. For use of my vehicle I am paid a car allowance of $0.40/km. The current reasonable rate in Alberta for under 5,000km a year is $0.52/km and $0.46/km for over 5,000km a year. Last year I had 22,000km of business travel. When I was filing my return I was told that I could not claim my car expenses because I received a reasonable allowance. To me this does not make sense when: 1.) The province has a posted reasonable rate that my allowance is under. 2.) After maintenance on the car, gas insurance and registration there is not much left to cover the wear and tear of my vehicle. I estimate the difference is approximately $600-$800 from what I was paid to what my car cost me to operate for work. I called Revenue Canada for an explanation and the person I spoke to said he was aware of the forms that I was talking about and validated my understanding of the "rules" but when I asked him to determine what would be considered an unreasonable amount he said there was no such thing and any amount paid by the employer is viewed as reasonable in their eyes. By that logic my employer could pay me $10 annually for use of my vehicle and in the eyes of the government it would be reasonable. Am I understanding this correct or am I able to claim the discrepancy amount as an expense?