We are looking to quantify the compensation value of a company vehicle and would like to know a ballpark value
From Glenn: Alas, this Q calls for an expertise that I don’t possess. So I have called in the heavy artillery–our resident expert, Alan McEwen
From Alan: There isn’t a flat dollar amount that can be given for the taxable benefit associated with the provision of a car to an employee. Instead there are formulas, given in this guide, https://www.canada.ca/en/revenue-agency/services/forms-publications/forms/rc18.html, that must be used. The factors in the formula that affect the result are based on:
- The value of the car, whether the purchase price or monthly lease cost;
- The portion of the year the car is available to the employee;
- The ratio of business to personal use;
- Whether the employer has paid operating costs in addition to providing the car itself; and
- Whether the employee has repaid any portion of the benefit received.