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Finance Department Raises Automobile Deduction Rates

Finance Department Raises Automobile Deduction Rates

Department of Finance Raises Automobile Deduction Rates

Source: Advisor’s Edge
Author: Melissa Shin
Date: December 23, 2021

Automobile deduction limits for businesses have been raised for 2022 in response to inflation, in some cases for the first time in almost 20 years.

As of Jan. 1, 2022, the deduction limits for capital cost allowances, leasing and mileage reimbursement have all increased, the Department of Finance announced Thursday.

For vehicles acquired after Jan. 1, 2022, the ceiling for capital cost allowances (CCA) for zero-emission passenger vehicles will be increased to $59,000 from $55,000. This is the first time the limit has been raised since it was introduced in the 2019 federal budget.

The CCA ceiling for passenger vehicles acquired after Jan. 1 will be increased to $34,000 from $30,000, and deductible leasing costs will be increased to $900 per month from $800 for new leases. Both figures had been fixed since at least 2003.

Click here to read the full article: https://www.advisor.ca/tax/tax-news/finance-raises-auto-deduction-rates/