Hi,
For truck drivers, where do you put the gas & repair costs? Does that fall within the motor vehicle expenses? Or would you put it in the calculation of gross profit ?
Regards,
It would be considered as a vehicle expense. You’d also need to write the mileage driven for work related. For tracking mileage, you can find an app that does that. I normally recommend MileIQ but their prices have increased drastically. I believe Quickbooks has a mileage tracker app as well, though there can be bugs here and there.
Thanks, just to clarify, I am talking about gas and other expenses that owner operators incur. Often, the gas in tens of thousands or even 100+k per year
While I appreciate the previous posters reply regarding tracking personal mileage…if we are talking about a Class 16 vehicle, I have never had an auditor require a log…just a statement saying this transport truck or heavy duty cube truck is only used for work.
Offer proof by way of household personal vehicles owned.
If taxpayer is driving anything that could be normally considered a personal vehicle half ton, cube van, heavy duty pickup, etc…a LOG is a must.
CRA is currently auditing vehicle expenses for 2021 onward.
If taxpayer is using this vehicle 100% for work, on T2125…vehicle details worksheet will still need to indicate the mileage for the year…my clients write mileage every JAN or when they buy/sell said vehicles.
If Corp client, I keep track in my working papers…similar to that of sole prop.
Rachel Parlee
(506) 874-3093
In the client’s financials, I have Motor Vehicle Expenses, with sub accounts for fuel, maintenance, insurance, licence, lease, interest, etc. On the T2125, I use Motor Vehicle Expenses.
I primarily use Cost of Goods Sold for a manufacturing type business.
On 2125
Line 8960 Repairs and Maintenance
Line 9224 Fuel Costs
Technically correct if the vehicle was owned by/registered to the individual. But, for all intents and purposes, a vehicle used 100% for business could be considered “owned” by the business, particularly in a proprietorship. Per the the instructions in TaxCycle (see below), you could avoid using the worksheet if you don’t need to track all the various items, and if you don’t use the worksheet, you wouldn’t need the mileage (or you could enter the same value in the “total kms driven” as the “kms driven for business” fields). I doubt this worksheet is transmitted to CRA - the details just get picked up on the T2125.
Correct that the details do not get transmitted. However, during a review… lots of them going on at the moment, we are required to provide this info.