The limits and rates used to determine deductible automobile expenses and calculate taxable benefits relating to the use of an automobile are as follows:

The limits and rates used to determine deductible automobile expenses and calculate the value of taxable benefits relating to the use of an automobile for 2026 are as follows:

• The deductible limit for tax-exempt allowances paid by employers to employees is increased to $0.73/km for the first 5,000 kilometres travelled and $0.67/km for additional kilometres. For the Yukon, the Northwest Territories and Nunavut, the deductible limit for tax-exempt allowances paid by employers to employees is increased to $0.77/km for the first 5,000 kilometres travelled and $0.71/km for additional kilometres.
• The prescribed amount used to determine the value of the taxable benefit an employee receives for the personal portion of the operating costs of an automobile provided by their employer remains at $0.34/km. For taxpayers whose main occupation is selling or leasing automobiles, the prescribed amount remains at $0.31/km.
• The maximum capital cost of non-zero-emission passenger vehicles for capital cost allowance purposes is increased to $39,000 (before GST and QST) for vehicles purchased after 2025.
• The maximum capital cost of eligible zero-emission passenger vehicles for capital cost allowance purposes remains at $61,000 (before GST and QST) for vehicles purchased after 2025. Eligible zero-emission passenger vehicles include plug-in hybrids with a battery capacity of at least 7 kWh and vehicles that are fully electric or fully powered by hydrogen.
• The deductible limit for eligible interest paid on amounts borrowed to purchase a passenger vehicle remains at $350/month for loans related to vehicles purchased after 2025.
• The deductible limit for eligible leasing expenses remains at $1,100/month (plus GST and QST) for leases entered into after 2025.