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2026 CRA Rates

CRA Mileage Rate 2026 — $0.73/km Deduction Calculator

What is the CRA mileage rate for 2026? The CRA automobile allowance rate for 2026 is $0.73 per kilometre for the first 5,000 km and $0.67/km after that. Calculate your business vehicle deduction below using the official 2026 CRA rates.

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2026 CRA Mileage Rate (Confirmed): $0.73/km (first 5,000 km)
$0.67/km after 5,000 km  |  Example: 10,000 km = $7,000 deduction
Territories: add $0.04/km ($0.77/$0.71)  |  Up from $0.72/$0.66 in 2025

Self-employed, freelancer, or small business owner? Enter your business kilometres below to instantly calculate your 2026 tax deduction using the simplified method.

Calculate Your Deduction ↓

Business Mileage Deduction Calculator

Enter your total business kilometres to calculate your CRA mileage deduction for 2026

2026 CRA Mileage Rates

First 5,000 km $0.73/km
Each additional km $0.67/km
km

Enter only business-related driving (not commuting to regular workplace)

First 5,000 km @ $0.73
5,000 km × $0.73 = $3,650.00
$3,650.00
Additional km @ $0.67
5,000 km × $0.67 = $3,350.00
$3,350.00
Total Mileage Deduction $7,000.00

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Quick Reference: Mileage Deduction by Distance

See how much you can deduct based on your total business kilometres driven in 2026. Tax savings estimated at a 30% marginal rate.

Business km Deduction Monthly Tax Savings
2,000 km$1,460~$37/month
5,000 km$3,650~$91/month
8,000 km$5,660~$142/month
10,000 km$7,000~$175/month
15,000 km$10,350~$259/month
20,000 km$13,700~$343/month
30,000 km$20,400~$510/month

2026 CRA Automobile Allowance Rates

First 5,000 km
$0.73 /km
Higher rate for first 5,000 business kilometres driven in the year
Additional km
$0.67 /km
Rate for every kilometre beyond the first 5,000
Territories Bonus
+$0.04 /km
Extra allowance for driving in Yukon, NWT, or Nunavut

What Vehicle Expenses Can You Deduct?

Simplified Method (Mileage Rate)

Use CRA's per-kilometre rates. Best for:

  • Lower business use (under 50%)
  • Simpler record-keeping
  • Employees receiving auto allowance

Detailed Method (Actual Expenses)

Track actual costs and prorate by business use:

  • Fuel and oil
  • Insurance premiums
  • License and registration
  • Maintenance and repairs
  • Lease payments or CCA
  • Interest on car loan

Deductible Business Driving

These trips qualify for deduction:

  • Client meetings and site visits
  • Supplier and vendor visits
  • Bank and post office trips
  • Delivery of goods/services
  • Professional development

NOT Deductible

These trips cannot be claimed:

  • Commuting to regular workplace
  • Personal errands
  • Vacation or leisure driving
  • Traffic violations/parking tickets

Simplified vs. Detailed Method Comparison

Factor Simplified (Mileage) Detailed (Actual)
Record-keeping Mileage log only All receipts + mileage log
Calculation km × CRA rate Total expenses × business %
Best for Lower business use Higher business use (50%+)
Typical deduction $3,650-$7,000/year $5,000-$15,000/year
CCA (depreciation) Included in rate Claim separately
Audit risk Lower Higher (more documentation)

Mileage Tracking Tips

Record Odometer Readings

Note your vehicle's odometer reading on January 1st and December 31st each year. This proves your total annual driving.

Log Every Trip

For each business trip, record: date, destination, purpose, and kilometres. Use iBill's expense tracking to log mileage as you go.

Compare Methods Annually

Calculate your deduction both ways at year-end. If your business driving is 50%+ of total, the detailed method often saves more.

Keep Records 6 Years

CRA can audit up to 6 years back. Store your mileage logs, gas receipts, and maintenance records for at least 6 years.

Frequently Asked Questions

What is the CRA mileage rate for 2026?
For 2026, the CRA mileage rate is $0.73 per kilometre for the first 5,000 kilometres driven for business purposes, and $0.67 per kilometre for each additional kilometre. These rates are used when calculating vehicle expense deductions using the simplified method.
How do I calculate my CRA mileage deduction?
Multiply your first 5,000 business km by $0.73, then multiply any additional km by $0.67, and add the two amounts. For example, if you drove 12,000 business km: (5,000 × $0.73) + (7,000 × $0.67) = $3,650 + $4,690 = $8,340 total deduction.
Can I claim mileage if I'm self-employed?
Yes! Self-employed individuals, freelancers, and sole proprietors can claim vehicle expenses for business-related driving. You can use either the simplified method (CRA per-km rates) or track actual expenses. Keep a detailed mileage log to support your claim.
What records do I need to keep for mileage claims?
The CRA requires a mileage log showing: the date of each trip, destination, business purpose, and kilometres driven. Also record your odometer at year start and end. If using the detailed method, keep all vehicle receipts (gas, insurance, repairs, etc.).
Is commuting to work deductible?
No, commuting from home to your regular place of business is NOT deductible. However, if you work from home as your principal business location, trips from home to clients, suppliers, or other business destinations ARE deductible.
Should I use the simplified or detailed method?
It depends on your business use percentage. The simplified method ($0.73/$0.67 per km rates) is easier and works well if business use is under 50%. The detailed method (actual expenses) often yields higher deductions if business use exceeds 50% of total driving.
Are CRA mileage rates higher in the territories?
Yes. In the Yukon, Northwest Territories, and Nunavut, the CRA adds $0.04 per kilometre on top of the standard rates. That makes it $0.77/km for the first 5,000 km and $0.71/km after. The higher rate reflects greater vehicle operating costs in northern Canada.
How much can I claim for mileage on my taxes in Canada?
Your deduction depends on how many business kilometres you drive. At 2026 CRA rates: 10,000 km = $7,000 deduction (saving ~$2,100 at 30% tax rate), 20,000 km = $13,700 deduction (saving ~$4,110). Use the simplified method (per-km rate) or detailed method (actual expenses) — whichever gives the higher deduction.
Did CRA mileage rates change for 2026?
Yes, CRA mileage rates increased for 2026. The new rates are $0.73/km for the first 5,000 km and $0.67/km after — up from $0.72/$0.66 in 2025. Rates are adjusted annually to reflect vehicle operating costs. Check the CRA website each January for the latest published rates.

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