Ask the ExpertCategory: QuestionsCompensation Value of a Company Vehicle
hri_Admin Staff asked 5 years ago

We are looking to quantify the compensation value of a company vehicle and would like to know a ballpark value

1 Answers
Glenn Demby Staff answered 5 years ago

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.

Let me know if I can be of further help,
Alan McEwen & Associates
855 Berwick Road South, Qualicum Beach, BC  V9K 1S7
250-228-5280