T2200 and T777 for Motor Vehicle Expenses
Use this page when the question is no longer the CRA rate, but whether an employee can support a motor vehicle expense claim.
At a glance
- T2200 is the employer declaration; T777 is the employee form used with the tax return.
- A signed T2200 does not create a deduction by itself. It supports the claim if the employee actually meets the CRA conditions.
- Employees claiming motor vehicle expenses still need distance logs, receipts, and a business-use calculation.
What each form does
The clean way to remember the pair is simple: T2200 comes from the employer, T777 goes with the employee's return. Employers use T2200 to confirm conditions of employment, including whether the employee was required to pay certain expenses and whether a motor vehicle allowance was received.
Employees then use T777 to calculate the deductible employment expenses. That calculation is where the records, percentages, and actual expense support matter.
What CRA expects you to keep
This is not a flat-rate claim. If the employee is claiming motor vehicle expenses rather than relying on a non-taxable allowance, CRA expects support for both the expense base and the business-use share.
- Trip log showing business kilometres and total kilometres for the year.
- Receipts or statements for fuel, insurance, maintenance, lease costs, and any other claimed cost.
- A copy of the signed T2200 kept with the tax file rather than sent on its own.
- Any payroll record showing whether the employer also paid an allowance or reimbursement.
When people mix up allowance and expense claims
A reasonable non-taxable per-kilometre allowance and an employee motor-vehicle expense claim are not interchangeable shortcuts. Once an employer pays the arrangement a certain way, the tax treatment can change.
That is why it is worth checking the allowance treatment first. If the employer paid a reasonable non-taxable per-kilometre allowance, the employee usually does not pivot back and claim the same vehicle use again as employment expenses.
Official references
Employer form used to confirm employment conditions.
Employee form used to calculate employment expenses.
Explains records and expense treatment for employee motor vehicle claims.
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