Hello,
For Uber driver who worked only 1 month, should I include all expenses in one year for gas, insurance,… And then the taxcycle will take the percentage?
Or only the expense in one month?
Here are snippets from the CRA Business & Professional Income Guide, T4002:
“You can deduct motor vehicle expenses only when they are reasonable and you have receipts to support them. To get the full benefit of your claim for each vehicle, keep a record of the total kilometres you drive and the kilometres you drive to earn income. For each trip, list the date, destination, purpose and number of kilometres you drive. Record the odometer reading of each vehicle at the start and end of the fiscal period.”
Note that most people who start their business later in the tax year probably won’t have their odometer reading recorded at the start of the year making it difficult to know the total km’s driven in the tax year. Thus claiming receipts for the entire year may be difficult if you don’t know the total km’s driven in the year compared to the total km’s driven for business in the one month of self-employment in your client’s situation.
CRA guide further states:
"If you use your vehicle occasionally for business purposes, you can claim motor vehicle expenses on a per-trip basis. For example, if you are operating a daycare business, taking the children to a park or on an excursion may involve paying for
fuel and parking.
I have a client who only uses his vehicle occasionally for business purposes (approx 500 km’s per year). We claim a rate that is reasonable based on the trips he makes, taking into account that he doesn’t use the entire tank of gas for business purposes. Remember, receipts are required to support the claim.
Why T4002 not T2125?
All those expenses related to the vehicle, which you mentioned, should be recorded in vehicle form and NOT directly on T2125. When you put in the mileage used for business and personal use for the year, Taxcycle automatically calculates the percentage of the expenses including vehicle depreciation. The Uber on the trip mileage is normally on the annual tax form Uber gives to the contractors. Just remember to take the pickup distance into account also.
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Thanks, but in this case I have to add gas amount spent, and CCA for the whole year and taxcycle will calculate it?
T4002 is the CRA GUIDE for completing the T2125. It is the instruction page that should be referred to, as it has answers to many questions you may have about claiming self-employment expenses.
But how to calculate it based on simple method as per km driven without calculating all expenses or keeping track of them?
An employer can use a per km rate, but a proprietor/partner needs to prorate actual costs. In this case, i would use the one month’s actual costs with insurance prorated, and let TaxCycle calcualte the business mileage over the total mileage for that period.
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Agree with helga_spence…
Never use per km rate for Self Employed and Yes, only claim the portion of the year vehicle is used… if started in June, ended in Sept… then I claim expenses June -Sept /
Total mileage for Vehicle is for that period not the year and obviously Actual driven for work from a log.
For clients who do not have a log… I send them back home to create one… based on their Calendar of appointments, purchase history, vehicle Repair history, etc…
This is a heavily audited Item… always ensure the clients has backup in hand before I file.
Then on this case I have to put first 
f January to end of January?
Yes of course
Do you mean fiscal year?
But end of January was not the last day in business, as He still has his account active.
Do not intend to insult you but if you are a tax preparer who has not prepared business income perhaps you need to take some courses before taking this on and you should refer this to another who has experience.
If you are a lay person, perhaps you should reach out to a knowledgeable tax preparer.
Yes, this will cost monies but in the end, the tax returns will be done correctly.
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Totally agree. Due to unforeseen circumstances I couldn’t finish my CGA, but I supplemented my tax study by taking courses from https://www.knowledgebureau.com/
Look especially at theses courses: https://www.knowledgebureau.com/site/program/tax-services-specialist
They are worth it!
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I concur with @rachelavryl and @Rein. You should not look to this forum to teach you income tax.
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I think for only one month of work, it is probably under $1000. I would make the person claim the income and tell them to suck up the expenses and if they plan on doing it again in 2024. Give them all the information they need to keep track, for the next tax year.