Canada Mileage ToolsUse CRA rates and province/territory tier logic for annual allowance estimates.
73 cents per kilometre
for the first 5,000 kilometres, then 67 cents per kilometre
Source: Government of Canada 2026 automobile allowance rates
The prescribed rates for 2026. Province and territory rates move together, and both step down once the year's business kilometres pass 5,000.
| Trip or vehicle | Rate | Source |
|---|---|---|
| Provinces | First 5,000 km · 73 cents per kilometre; After 5,000 km · 67 cents per kilometre | Government of Canada 2026 automobile allowance rates |
| Territories | First 5,000 km · 77 cents per kilometre; After 5,000 km · 71 cents per kilometre | Government of Canada 2026 automobile allowance rates |
The province rate by year, with the territory pair from the same announcement. The two-tier structure and the threshold have not changed; the amounts are what move.
Provinces · 73 cents per kilometre -> 67 cents per kilometre
Provinces · 72 cents per kilometre -> 66 cents per kilometre
Provinces · 70 cents per kilometre -> 64 cents per kilometre
Provinces · 68 cents per kilometre -> 62 cents per kilometre
Provinces · 61 cents per kilometre -> 55 cents per kilometre
Provinces · 59 cents per kilometre -> 53 cents per kilometre
The prescribed rate is a reasonableness test for allowances and a benchmark for self-employed claims. Which side you are on decides the paperwork.
Paid at or below the prescribed rate, on business kilometres you have recorded, the allowance is generally not taxable, and the two tiers run on the calendar year.
CRA mileage rate 2026The actual-cost route for an employee needs the employer's T2200, Form T777, and a record of both total and business kilometres.
T2200 and T777 guideA sole proprietor claims the business-use share of real costs. The prescribed rate is the benchmark the CRA accepts for employee allowances rather than a rate a business has to use.
CRA self-employed mileage 2026Whether the allowance lands on a T4 slip turns on how it is calculated and whether the employee accounted for the kilometres, not on the amount alone.
CRA taxable allowance guideThe CRA expects a log that shows the year's total distance and the business share of it. A shorter sample period can stand in only while the pattern of use holds.
How long to keep it
Keep the records for six years from the end of the last tax year they relate to.
What a logbook has to show, and how the business-use share is established.
Source: CRA: motor vehicle records
The prescribed rate is 73 cents per kilometre for the first 5,000 kilometres, then 67 cents per kilometre. Territory driving uses the higher pair: 77 cents per kilometre for the first 5,000 kilometres, then 71 cents per kilometre.
Generally not, when it is paid on kilometres the employee recorded and the rate stays at or below the prescribed amount. If the employee keeps no record of the kilometres, the CRA generally treats the allowance as taxable and it belongs on the T4 slip.
No. The prescribed rates are federal and the same across the country. What changes between province and territory is which pair applies, because the territory rates are set higher to reflect the cost of driving in the north.
Six years from the end of the last tax year the records relate to, which is the same retention period the CRA applies to the rest of the documents behind a return.
Form T2200, completed and signed by the employer, establishes that the employment conditions required the expenses. Form T777 is filed with the return to claim them.
The prescribed per-kilometre rates by year, and when an allowance is taxable.
The six-year retention period for supporting records.
Every CRA page on the site: the rates in force, the calculators that price them, and the templates that support a claim.