EXPENSES INCURRED WITH TWO CARS IN THE SAME
CATEGORY
Revenu Canada included Class 54 for Zero-emission vehicles
that would normally be included in Class 10 or 10.1.
For more information, please consult the following link:
https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/about-your-tax-return/tax-return/completing-a-tax-return/deductions-credits-expenses/line-22900-other-employment-expenses/capital-cost-allowance/classes-depreciable-properties/zero-emission-vehicles.html
If you used two vehicles of the same class during the tax
year, you must complete a page for each
vehicle and enter the following information:
1. On the "Left side menu of the Interview tab", under
"Self-employment income", choose the "Motor vehicle
expenses" sub-section.
2. On the screen on the right, select "Purchased motor
vehicle" and enter the information about the vehicle (s) on the
page that appears.
3. For the line "Level at which the expense is claimed",
choose "Business expenses" in the drop-down menu to your
right.
4. For the line "CCA class of the vehicle", select
"Class 10 - 30%" or "Class 10.1 - 30%" from the
drop-down menu to the right.
NOTE: Your passenger vehicle can belong in
either Class 10 or Class 10.1. To
determine the class your passenger vehicle belongs, you must use
the cost of the vehicle before
you add the GST/PST, or
the HST. Include your passenger vehicle in Class
10.1 if you bought it in the current tax
year and it cost more than $30,000.
5. For the line "Opening balance of the undepreciated capital
cost", enter the undepreciated capital cost (UCC) at the
beginning of the fiscal period. Generally, the UCC is the amount
left after you deduct CCA from the capital cost of a depreciable
property.
If you have used the same software last tax year, the amount
will be reported automatically. If you used a different software,
you could find the UCC amount on the form T2125 from the previous
tax year, at the Area A, in column 10.
6- For the second vehicle, if is not an addition, enter the fair
market value on the line "Opening balance of the undepreciated
capital cost". But, if it is an addition, complete the
"Addition of a vehicle" section.
7. Enter the business mileage and the total mileage for each
vehicle used during the tax year.
8. Enter the expenses for each vehicle used during the tax
year.
9. You must perform the same procedure for the second
vehicle.
However, for Section A on page 5 of Form T2125, the amounts from
the columns will be reported in proportion to the expenses in
relation to the use of vehicles for business purposes.
Nevertheless, the program will carry over to the following year
the correct "Undepreciated capital cost opening
balance".
We recommend that you keep detailed records of all expenses. You
must keep your records for at least six years.
For more information on this topic, please consult the following
link:
https://www.canada.ca/en/revenue-agency/services/forms-publications/publications/t4002.html
ID: 20220223142224DE.xml
Webpage: KPA320-20220223142224DE.htm
