Rules of Application
- These rules apply where an employer makes an automobile “available” to an employee or a person related to the employee.
- A vehicle is made available to the employee, or a person related to the employee, if the employee has access or control over use of the vehicle.
- Vehicles not included under these rules are:
- taxis
- buses
- hearses
- clearly marked emergency medical response vehicles
- vans, pick-up trucks that:
- have a seating capacity of not more than the driver and two passengers and are acquired to transport goods, or
- are used 90% or more of the time to transport goods, equipment or passengers.
- An employee receives a benefit to the extent that the automobile is used for personal driving.
- Personal driving includes:
- vacation trips
- driving for personal use
- travel between home and work
- by the employee or person related to employee
- Personal driving does not include travel from home to a point of call other than the regular place of business of the employer or the return home from that point.
- For Quebec resident employees:
- When an automobile is made available to an employee, the employee must remit a logbook to the employer.
- The logbook must be remitted no later than the 10th day following:
- the end of the year, or
- the end of the period during which the automobile was made available to the employee, if that period ends before the end of the year.
- Any employee who fails to remit the logbook by the applicable deadline is subject to a penalty of $200.
Computation of Benefit
There are two types of benefits to be computed where an employer provided automobile is used by an employee for personal purposes:
I. Standby Charge
- It represents the benefit employees enjoy when an employer’s automobile is available for their personal use.
- It is reduced by any reimbursements paid in the year by the employee to the employer for the use of the automobile.
Click here for a chart on how to compute the Standby Charge
II. Operating Cost
- It represents the benefit received in respect of automobile operating expenses paid by the employer and relating to the personal use of a company owned/leased automobile.
- It is reduced by any reimbursements paid by the employee to the employer in the year or within 45 days after the end of the year for the use of the automobile
- Operating costs include:
- gasoline and oil
- licenses
- insurance
- repairs and maintenance
- Expenses do not include:
- interest
- parking
- capital cost allowance
- lease costs
- Two methods available to calculate the benefit:
- “simplified” method, or
- one-half of the standby charge (restrictions apply).
Click here for the chart on how to calculate the Operating Cost Benefit