CRA Mileage Rate 2026 Calculator
Enter your business kilometres and see the tax-free car allowance an employer can pay at the Canada Revenue Agency's 2026 rates: 73¢/km for the first 5,000 km and 67¢/km after that (77¢ and 71¢ in the territories).
CRA Kilometre Rates: 2026 vs 2025
The CRA's reasonable per-kilometre allowance rates are set each year under section 7306 of the Income Tax Regulations. For 2026 every rate went up by 1¢.
| Rate per km | 2026 | 2025 |
|---|---|---|
| Provinces, first 5,000 km | 73¢ | 72¢ |
| Provinces, after 5,000 km | 67¢ | 66¢ |
| Territories (YT, NT, NU), first 5,000 km | 77¢ | 76¢ |
| Territories (YT, NT, NU), after 5,000 km | 71¢ | 70¢ |
Source: the CRA's automobile allowance rates and the Department of Finance's 2026 announcement.
Who the CRA Rate Is For
Employees Paid a Car Allowance
The CRA rate is the amount per kilometre the CRA generally accepts as a reasonable allowance when an employer pays an employee for using their own vehicle for work. An allowance at or below this rate is generally not taxable to the employee when it is based only on business kilometres and the employee isn't also reimbursed for the same costs. A flat monthly amount that isn't tied to kilometres is generally taxable. For an employer, the rates are also the most that can be deducted for tax-exempt allowances paid to employees.
Self-Employed and Contractors
If you work for yourself, the CRA rate is not your deduction. Self-employed people generally deduct their actual vehicle costs (fuel, insurance, maintenance and repairs, licence and registration, interest or lease payments and capital cost allowance) multiplied by their business-use percentage: business kilometres divided by total kilometres for the year. Use the rate as a benchmark, for example to check whether your actual costs are in a sensible range or to bill a client for travel. Your accountant can tell you what applies to your return.
This calculator gives general information, not tax advice. Rules can depend on your situation, so check with your accountant before you file.
What Counts as Business Driving
- Usually counts: driving between work locations, to clients, customers, job sites and inspections, to pick up supplies, and from home to a place that isn't your regular workplace, such as a customer's address.
- Usually doesn't count: driving between home and your regular place of work, and personal errands or side trips during a work day.
The CRA's allowance page has more detail on the difference between business and personal driving.
Logbook Basics
Whether you are paid an allowance or deduct actual costs, your kilometres need records behind them. The CRA asks for:
- For each business trip: the date, destination, purpose and kilometres driven.
- Your odometer reading at the start and end of the year, and when you buy, sell or trade a vehicle.
The simplified logbook. Once you have kept a full logbook for one complete year (your base year), you can keep a logbook for a three-month sample period in later years. The sample is used to estimate the year's business use, as long as it stays within 10% of the base year's results. If it moves by more than that, start a new 12-month base year. See the CRA's motor vehicle records page.
Prefer paper or a spreadsheet? Our free mileage log template has the columns in the format CRA asks for, as a printable PDF and a CSV for Excel or Google Sheets.
Let Your Mileage Log Fill Itself
RouteWren builds a mileage log from the routes you plan: each day's kilometres from your base, every stop and back. Add odometer readings if you like, turn on CRA rates in Settings, and export a day, week, month or year as CSV or PDF.
Plans from $12/month CAD. 14-day free trial, no card needed.
Frequently Asked Questions
What is the CRA mileage rate for 2026?
For 2026 the CRA's reasonable per-kilometre allowance rate is 73 cents for the first 5,000 business kilometres and 67 cents for each kilometre after that. In Yukon, the Northwest Territories and Nunavut it is 77 cents and 71 cents. In 2025 the rates were 72 and 66 cents (76 and 70 cents in the territories).
Can I use the CRA mileage rate if I'm self-employed?
Not as your deduction. Self-employed people generally deduct their actual vehicle expenses (fuel, insurance, repairs, licence and registration, interest or lease costs, and capital cost allowance) multiplied by their business-use percentage, which comes from a logbook. The per-km rate is a useful benchmark, but check with your accountant for your own return.
Does driving from home to work count as business kilometres?
Generally no. The CRA treats driving between home and a regular place of work as personal. Driving between work locations, to clients or job sites, and from home to a place that isn't your regular workplace, such as a customer's address, can count as business driving.
Is the 5,000 km first tier per year?
Yes. The higher rate applies to the first 5,000 business kilometres in the year, and the lower rate to every kilometre after that. If some kilometres have already been paid earlier in the year, enter them in the calculator so it starts in the right tier.
Is a per-kilometre allowance taxable?
An allowance is generally not taxable to the employee when it is reasonable, is based only on the number of business kilometres driven, and the employee isn't also reimbursed for the same costs. A flat allowance that isn't tied to kilometres is generally taxable.
What records do I need to keep?
Keep a logbook with the date, destination, purpose and kilometres for each business trip, plus your odometer readings at the start and end of the year. After one full year of records, a three-month sample logbook can be used in later years if business use stays within 10% of that base year.
Sources
- Canada Revenue Agency: Automobile and motor vehicle allowances (reasonable per-kilometre rates, business vs personal driving)
- Canada Revenue Agency: Motor vehicle records (logbook and simplified logbook)
- Department of Finance Canada: 2026 automobile deduction limits and expense benefit rates
Rates checked October 25, 2026. RouteWren is not affiliated with the Canada Revenue Agency.