Personal Use of a Motor Vehicle, Other Than an Automobile, Made Available to an Employee
If you make a motor vehicle other than an automobile (such as an ambulance, pickup truck, van or bus) available to an employee for the employee's personal use, you must calculate the value of the employee's benefit.
The value of the benefit corresponds to a reasonable estimate of the fair market value (FMV) of the actual benefit. We consider a reasonable estimate of the FMV to be all amounts that the employee would normally have had to pay for a comparable vehicle in an arm's-length transaction, such as leasing expenses and operating costs.
If the vehicle is essential to the operation of your business and the only personal use made of it by the employee is to travel between home and the workplace, you may calculate the value of the benefit on the basis of a per-kilometre rate used for equivalent transportation.
For 2019 and 2020, we consider a benefit calculated at the rate of $0.28 per kilometre to be reasonable, provided all four of the following conditions are met:
- The motor vehicle is not an automobile.
- You notify your employee in writing that the only personal use the employee may make of the vehicle is to travel between home and the workplace and that he or she is required to keep a logbook in which all the vehicle's trips are recorded as proof that no other personal use is made of the vehicle.
- For valid business reasons, you require that your employee drive the vehicle home in the evening. For example:
- tools and equipment cannot be safely left overnight at the work site or place of business, or
- your employee must remain on call for emergencies and the motor vehicle is provided to reduce the emergency response time (see the note below).
- The motor vehicle is specially designed or equipped to meet the needs of your business or trade, and is essential for the employee to carry out his or her duties. The following are examples in which these requirements are met:
- The vehicle is specially designed (or has been significantly modified) to transport tools, equipment or goods.
- The vehicle (a van or pickup truck) is permanently equipped and used for transporting and storing heavy, bulky or numerous tools or pieces of equipment, and it would be difficult to load and unload the contents of the vehicle.
- The vehicle is used, on a regular basis, to transport harmful or foul-smelling materials (such as veterinary samples or fish and game).
- Your employee is on call for emergencies (see the note below) and has to use:
- a clearly marked emergency vehicle,
- a vehicle specially equipped for responding to emergencies, or
- a vehicle designed to transport specialized equipment to the scene of an emergency.
For purposes of calculating the benefit, an employee who uses any such vehicle to travel between home and the scene of an emergency is not considered to be making personal use of the vehicle.
- As a rule, any situation in which the health and safety of the general public may be affected or in which the employer's activities are significantly disrupted may be considered an emergency.
- The employee's use of the vehicle to travel between home and the workplace is not considered to be essential for the employee to carry out his or her duties.
Include the value of the benefit in boxes A, G and W of the employee's RL-1 slip (see courtesy translation RL-1-T).
If you make a motor vehicle, other than an automobile, available to a shareholder who is not an employee, for the shareholder's personal use, you must calculate the value of the benefit as described above.
Include the value of the benefit in box O of the shareholder's RL-1 slip and enter “RO” in the “Code (case O)” box.
If the benefit is provided to the shareholder as an employee of the corporation rather than as a shareholder, include its value in boxes A, G and W of the shareholder's RL-1 slip.
Note that “employee” means an individual who holds employment or an office.