Capital Cost of Passenger Vehicles

The ceiling for CCA for passenger vehicles will be increased from $36,000 to $37,000, before tax, in respect of vehicles (new and used) acquired on or after January 1, 2024.

The ceiling for capital cost allowances (CCA) for zero-emission passenger vehicles will remain at $61,000, before tax, in respect of vehicles (new and used) acquired on or after January 1, 2024.

Leasing Costs

Deductible leasing costs will be increased from $950 to $1,050 per month, before tax, for new leases entered into on or after January 1, 2024. 

Tax-Exempt Allowance Limit

The limit on the deduction of tax-exempt allowances paid by employers to employees who use their personal vehicle for business purposes will increase by two cents to 70 cents per km for the first 5,000 km’s driven, and 64 cents for each additional km.

Maximum Allowable Interest Deduction

The maximum allowable interest deduction for amounts borrowed to purchase an automobile will be increased from $300.00 to $350.00 per month for loans related to vehicles acquired after 2023.

The general prescribed rate used to determine the taxable benefit of employees relating to the personal portion of automobile expenses paid by their employers will remain at 33 cents per km for 2024.

2024 Automobile Allowance

The automobile allowance rates for 2024 are:

• 70¢ per kilometre for the first 5,000 kilometres driven
• 64¢ per kilometre driven after that

December 18, 2023 – Ottawa, Ontario – Department of Finance Canada

Contact SSL Group for more information.