Tax year 2026 · CAD · kilometres
Car logbook rules and business car tax in Canada
What a car logbook needs to contain
Under the rules recorded for Canada, each trip entry should show:
- Date
- Destination
- Purpose
- Kilometres
The logbook period is at least 365 days. Keep your records for 6 years.
- Record each vehicle’s odometer at the start and end of the fiscal period, and at purchase, sale or trade.
- Keep one full-year base logbook; in later years a 3-month sample logbook is accepted if business use stays within 10% of the base year (annual % = sample % ÷ base-period % × base-year %).
- Keep records 6 years from the end of the tax year; the base logbook 6 years from the last year it was used.
Ways to claim and current rates
Business use of actual expenses (self-employed)
Self-employed people deduct actual vehicle expenses × business km ÷ total km, with capital cost allowance on the business share. There is no per-km deduction for the self-employed.
Reasonable per-km allowance (employees)
The most an employer can pay tax-free per business km for an employee’s own car. Territories (Yukon, NWT, Nunavut) get 4¢ more.
| Vehicle | Rate | Status | Applies |
|---|---|---|---|
| Provinces | $0.730/km up to 5,000 km, $0.670/km after that | Confirmed | 2026-01-01 – 2026-12-31 |
| Territories | $0.770/km up to 5,000 km, $0.710/km after that | Confirmed | 2026-01-01 – 2026-12-31 |
Worked example (estimate)
Say you drove 5,000 km for work in a year, your car costs came to $8,000 and your logbook shows 60% business use. With the figures on this page the estimates are:
- Business use of actual expenses (self-employed) (60% of $8,000)$4,800.00
- Reasonable per-km allowance (employees) (Provinces)$3,650.00
These are estimates only. A real claim depends on your situation and on conditions this example does not check.
Fuel schemes
Saskatchewan farm fuel (tax-reduced marked diesel)
Saskatchewan farmers, commercial fishers, trappers and loggers with a Fuel Tax Exemption Permit can buy marked diesel at 3¢/L tax instead of 15¢/L. The saving shown is per litre.
Who: Saskatchewan farmers (75+ cultivated acres or $10,000+ farm revenue), commercial fishers, trappers, loggers · Claimed: No claim: buy marked diesel with an annual Fuel Tax Exemption Permit (renew yearly in SETS) (year) Confirmed
Alberta Farm Fuel Benefit (AFFB)
Eligible Alberta producers get a 9¢/L exemption on marked gasoline and diesel used for farming. Alberta’s fuel tax is suspended from 1 Oct to 31 Dec 2026, so the exemption is worth nothing in that period.
Who: Eligible Alberta farmers with an AFFB number · Claimed: Show an active AFFB number to the fuel seller when buying marked fuel (year) Confirmed
Other driving-related savings
Federal fuel charge (carbon price) removed Confirmed
The federal fuel charge has been zero since 1 April 2025, and the farmers’ fuel charge tax credit ended with the 2024–25 year. Nothing to claim for later fuel.
Zero-emission vehicles: Class 54 capital cost allowance Confirmed
Business zero-emission passenger vehicles go in Class 54 with depreciation (CCA) on up to $61,000 before tax for 2026; ordinary passenger cars in Class 10.1 are capped at $39,000 for vehicles bought from 1 Jan 2026.
Questions
Which ways of claiming a car does Canada allow?
Business use of actual expenses (self-employed) and Reasonable per-km allowance (employees). The table above shows the rates for each.
How long do I need to log trips?
The logbook period is at least 365 days. Keep your records for 6 years.
Is the calculator result what I can claim?
No. It is an estimate based on the rates on this page and the numbers you enter. The tax authority decides what is allowed.
Where does Clocked keep my trips?
On your phone. You can export them as a file for your accountant.
How Clocked handles this
Clocked records your trips, works out your business percentage and compares the ways of claiming that Canada allows, using the same rules shown on this page. It makes an export for your accountant. It does not file anything for you.
Sources
Main authority and source: Finance Canada 2026 automobile limits and rates
Other countries: /clocked/tax/au/ · /clocked/tax/nz/ · /clocked/tax/gb/ · /clocked/tax/ie/ · /clocked/tax/ca/fr/ · Car tax by country
Let Clocked keep the logbook
Clocked records your trips and compares the ways you can claim in Canada, then exports a logbook your accountant can work with.