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Commuting or business driving: where the CRA draws the line
Why the drive from home to your regular workplace is personal, what flips a trip to business, and how to keep a log that survives a review.
A 14 km drive from a home office in Rosemont to a client in Laval goes in the log as business. The same 14 km to a desk you rent downtown does not. The CRA states that rule in one sentence, and the rest of the job is keeping a record that shows which of your drives is which, at the time, instead of guessing in March.
The basic rule: home to work is personal
The CRA is direct about the ordinary commute. Its guidance for employees deducting vehicle expenses states that “the CRA considers driving back and forth between home and work as personal use.” That drive does not go in the log as business kilometres, and it does not count toward a deduction or toward the CRA’s automobile allowance for an employer paying one, however far it is or however early it starts.
The same logic runs through the rules for the self-employed. The CRA’s guidance on calculating motor vehicle expenses says that “if you use a motor vehicle or a passenger vehicle for business and personal use, you can deduct only the part of the expenses that you paid to earn income.” A regular commute to a fixed office is not driving that earns income any more for a sole proprietor than it is for an employee: it is the cost of getting to work, not a cost of doing the work.
What flips a trip to business
Once you are away from the commute, the test is simpler than people expect: did the trip serve the business. A drive to a client’s office, a job site, a supplier, or a meeting away from your regular workplace is a business trip and belongs in the log. We covered the sharper edge of this, the drive from home directly to a client instead of to your regular workplace, in what the CRA wants in a mileage logbook: the destination is what does the work, not the starting point.
Where this gets genuinely case-specific, home offices, multiple regular work locations, a day with several client stops, is exactly where the general rule stops being enough and the facts of your situation start to matter. None of the three sources behind this article spell out a formula for those cases, and that is worth saying plainly rather than guessing: if a meaningful share of your driving falls into one of these grey areas, it is worth a conversation with an accountant who can apply the rule to your specific pattern of travel, not just this article’s summary of it.
Recording trips so the split is provable
The CRA does not ask you to explain your reasoning after the fact. It asks for a log kept as you go. For each business trip, its guidance on motor vehicle records asks for four things: the date, the destination, the purpose, and the number of kilometres driven. A vague purpose like “meeting” does little for you if a return is ever reviewed; a destination and a reason (“14 km, Dupont Plumbing, estimate for kitchen renovation”) does the work on its own.
Personal trips, including the commute, do not need to be itemised the same way, but the odometer readings at the start and the end of your fiscal period still matter. They give you the total kilometres the vehicle drove, and total kilometres minus business kilometres is what is left over as personal, commuting included.
The business-use percentage, worked example
Whether you deduct actual expenses or account for an allowance, the arithmetic runs on the same ratio: business kilometres divided by total kilometres. The CRA’s own example puts a number on it. A taxpayer who drove 27,000 business kilometres out of 30,000 total kilometres, against $5,400 in vehicle expenses for the year, works out the deductible share as 27,000 ÷ 30,000 × $5,400 = $4,860, or 90 percent of the total. The commute and every other personal trip are what make up the other 10 percent.
An employee and a self-employed person arrive at a business-use percentage the same way, but what they do with it differs: one compares it against an employer’s allowance, the other applies it to actual expenses on a return. We laid out both regimes side by side, with a worked example, in employee allowance or self-employed deduction.
What is fully deductible either way
Two costs skip the percentage entirely. The CRA’s guidance says you can deduct the full amount of parking fees related to your business activities and supplementary business insurance, regardless of your business-use share. A parking receipt from a client visit is not prorated the way fuel or insurance premiums are; keep it with the trip it belongs to so the connection is obvious later.
Keeping the split honest month to month
The cleanest way to keep commuting out of your business kilometres is to not have to remember the distinction at trip 400 of the year. A log that separates each drive by destination and purpose as it happens, rather than one reconstructed at tax time, is what lets business kilometres divided by total kilometres mean what the CRA expects it to mean. Odie records each trip automatically as you drive and asks you to mark it Work or Personal, so the commute stays out of your business total without you having to sort it out later. You can check current CRA figures any time on our CRA mileage rate page, or run a distance through the mileage calculator to see what a given split is worth.
Sources
- CRA: Motor vehicle expenses (T2125)
- CRA: Motor vehicle records
- CRA: Allowable motor vehicle expenses, salaried employees (line 22900)
Drafted with AI assistance from the sources above, then checked against them figure by figure by a second pass before publishing. How this blog is written. Not tax advice; your accountant knows your situation. Spotted an error? Tell us.