# Driving Personal Vehicle for Work = Profit?



## motl (Mar 3, 2014)

Not sure if this is a frugal topic but maybe.

My current job has me traveling from Ottawa to Toronto area from time to time, although I'll be making the trip ~5 times in the next 6 weeks. I normally fly there because Porter makes it simple but I do have the option to drive. My boss reminded me of that and confirmed my company would reimburse $0.50 per kilometre. I'm used to driving for my job but in my prior role I had a company vehicle.

I'm hesitant to add a bunch of KM to my personal vehicle but also curious if the reimbursement could be benefitial if I don't mind the drive? Math isn't my strong suit so I'm curious if others have made this call before and/or if there's a way to calculate the relative return? If it matters, I'm driving a 2018 Kia Forte with ~20,000 on it.


----------



## andrewf (Mar 1, 2010)

I think 50 cents is pretty decent.

Depending on the vehicle, fuel will be about 10 cents per km. That leaves 40 cents/km for depreciation, repairs, etc. If you drive 20k km per year, that's 40 cents (50-10 for fuel) times 20k = $8k per year, which should more than cover wear and tear. That said, your company would be paying you $450 for the round-trip, and flights are certainly cheaper than that. My work encourages us to rent cars and expense fuel purchases when we are driving large distances, rather than paying a per km rate.


----------



## STech (Jun 7, 2016)

Don't forget that if you drive for work, then you'll need to tell your insurance company, who will charge you more for the coverage. You can chance it and not tell them, but if you get into an accident and they find out it was commercial use, you'll be in a bit of trouble.


----------



## OptsyEagle (Nov 29, 2009)

Also, if you lease your vehicle be aware of the extra Km charges that might be incurred when you take the car back at the end of the lease.


----------



## ian (Jun 18, 2016)

You will of course have to deduct you employer auto reimbursement from the total of you business related auto expenses.

As a manager, depending on the logistics/destination/weather, I preferred members of the team to fly rather than drive. I wanted them to have more sales time, more billable hours in front of customers. I wanted them to be fresh in front of customers and I did not want them driving four hours to get home after a busy and sometimes stressful day.


----------



## agent99 (Sep 11, 2013)

ian said:


> You will of course have to deduct you employer auto reimbursement from the total of you business related auto expenses.


Not sure I understand that. 

If it his personal car and his employer reimburses him for using it for an occasional business trip, not sure your statement is accurate. If he was self employed or if the company paid him a car allowance, or paid more than the allowable CRA rates, that would be different? He also would not be claiming the reimbursements on a tax return.



> From CRA:
> *When you get paid to to drive your own car*
> Double-dipping is not OK. If your employer reimburses you for work-related driving expenses or pays you an automobile and motor vehicle allowance, you can't claim vehicle expenses.
> 
> ...


I at times drove my personal car for business trips and collected the mileage on my expense reports. The rate was set by the company, and was a bit less that the CRA rate. One thing I did do, was use the extra money I received to keep the car properly maintained. I still have that car and it has now done 440k kms!


----------



## ian (Jun 18, 2016)

This is easy. I claimed my car expenses for many years against commission income. The basic formula was simple:

Car Expenses: depreciation (CCA), insurance, financing, gas, repairs, etc. X Percentage of Business Use (based on KM log) = Auto expenses attributable to business use

Less: Employer reimbursed auto expenses (in my case it was car allowance plus km reimbursemt)

Total: This is the bottom line for car expenses that you can claim against income (under certain circumstances and with a T2020 from the employer)

My employer included the car allowance and km reimbursement dollars on my T4


IF you are not claiming car expenses against you income tax then I would assume you simply take the km reimbursement and you would not report it.


----------



## agent99 (Sep 11, 2013)

ian said:


> IF you are not claiming car expenses against you income tax then I would assume you simply take the km reimbursement and you would not report it.


Exactly - That is what motl said - he would be able to charge 50c/km for mileage. He puts that on his expense account and pockets the money when paid. That Kia will need some of it!


----------



## lonewolf :) (Sep 13, 2016)

Buy an electric Arcimoto fun utility vehicle that is good for 130 miles full charge US $12,000 plus EU 2200i Honda generator for $1100 over 8 hrs run time per gallon of gas.
Strap the generator on the back of Aricimoto to recharge electric vehicle. 
Collect the $.50 km 
Travel 110 km/hr you will be making close to $60 an hour to go towards gas & price of FUV the FUV could always be sold latter


----------



## indexxx (Oct 31, 2011)

STech said:


> Don't forget that if you drive for work, then you'll need to tell your insurance company, who will charge you more for the coverage. You can chance it and not tell them, but if you get into an accident and they find out it was commercial use, you'll be in a bit of trouble.


Not sure how it works in Ontario, but in BC you're allowed to drive 6 days in a calendar month for business or commercial use. Beyond that you need commercial insurance.


----------



## 319905 (Mar 7, 2016)

Maybe try it once, see what you think. Many many years ago I drove for a living, enjoyed it very much ... would I drive Ottawa/Toronto (401 specifically) on a regular basis these days? No, not even clearing that (possibly taxable benefit) $400/trip.


----------



## MrMatt (Dec 21, 2011)

STech said:


> Don't forget that if you drive for work, then you'll need to tell your insurance company, who will charge you more for the coverage. You can chance it and not tell them, but if you get into an accident and they find out it was commercial use, you'll be in a bit of trouble.


In Ontario I got this, it was like $20/yr or something small.

Few advantages to my own car, I like driving my car (VW Golf) way more convenient, I get less than 6L/100km, and in the winter I have snow tires.


----------



## Ponderling (Mar 1, 2013)

well I crunched my well cared for 14yo truck over the winter in a snow event, and insurer did not want to repair it. I got $3k for it. Used to about $300 per month for gas in the truck. So no longer as many kids scout events or home rens that made best use of the truck capabilities. 

Free level 1 charging plug at the office 
So I sprung $33k for a Volt. My commute is charged at the office. 
Yes some charging at home over the weekend.

But getting $0.55 for mileage when I have no energy costs to make the trip makes work related travel pretty nice. Most of my trips are under about $150km round trip, so maybe 2L of gas for the long trips.


----------

