CRA mileage rate 2026.
For 2026, the CRA reasonable per-kilometre rate is 73 cents per kilometre for the first 5,000 business kilometres driven in the year, and 67 cents for every kilometre after that. In the Northwest Territories, Yukon and Nunavut, add 4 cents to both. It is the rate for a tax-free allowance an employer pays an employee; if you're self-employed, you claim actual vehicle costs instead.
CRA per-kilometre rates by year
| Tax year | First 5,000 km | After 5,000 km | Territories, first 5,000 | Territories, after |
|---|---|---|---|---|
| 2026current | 73 cents | 67 cents | 77 cents | 71 cents |
| 2025 | 72 cents | 66 cents | 76 cents | 70 cents |
| 2024 | 70 cents | 64 cents | 74 cents | 68 cents |
Calculate your allowance
This is the CRA reasonable per-kilometre allowance: the amount an employer can pay an employee for business driving without it being taxed. It is not a self-employed deduction. If you file a T2125, you claim the business-use share of your actual vehicle costs instead (business kilometres divided by total kilometres), not this number. General guidance, not tax advice.
How the 5,000 kilometre tier works
The threshold is cumulative across the tax year, not per trip and not per vehicle. Your first 5,000 business kilometres in the year are worth the higher rate; everything past that is worth the lower one. The count starts again on 1 January.
So a year with 7,500 business kilometres in 2026 is not 7,500 at 73 cents. It is 5,000 at 73 cents plus 2,500 at 67 cents. The calculator above splits the tiers for you.
Is the mileage rate different in Ontario, Alberta or BC?
No. The rate is federal, so it is identical in every province. Searches for a provincial mileage rate are really searches for the national one. The only variation is the northern supplement: travel in the Northwest Territories, Yukon and Nunavut adds 4 cents per kilometre to both tiers.
Self-employed? You claim actual costs, not the rate
The per-kilometre rate is what an employer can pay an employee without the allowance being taxed. It is not a deduction you can take on a T2125. Self-employed drivers deduct the business-use share of what the vehicle actually cost: fuel, insurance, maintenance and repairs, licence and registration, and lease payments or loan interest go on line 9281, and capital cost allowance on the vehicle goes on line 9936.
The business-use share is business kilometres divided by total kilometres driven in the year. Drive 20,000 km with 8,000 for business and you claim 40% of those costs. Parking for business trips is the exception: you can deduct it in full. The CRA sets out the method on its motor vehicle expenses page.
You still need a logbook
The rate answers what an employer can pay per kilometre. It does not prove you drove it. The CRA expects a record of each business trip showing the date, destination, purpose and distance, along with your total kilometres for the year, because a vehicle claim rests on the business-use share: business kilometres divided by total kilometres driven.
This is where most claims fall apart, and it is a record-keeping habit rather than a tax question. scan-ai has a mileage section where you log each trip with its date, distance and purpose, and it totals your business kilometres for the year, the first number in your business-use share. It shows the per-kilometre allowance only as a reference estimate, never as a deduction. It does not detect drives automatically in the background the way a dedicated GPS mileage app does, so the trip still gets entered by hand.
General guidance, not tax advice. Rates change annually and the right method depends on your situation, so confirm the current figures with the CRA or your accountant before you file.
Keep going
- CRA business expense categories and the T2125 covers line 9281, where motor vehicle expenses land.
- GST/HST input tax credit finder for the sales tax on the fuel and repair receipts behind those kilometres.
- Freelancer deduction finder and scan-ai for Canadian filers.
CRA mileage, plainly.
What is the CRA mileage rate for 2026?
For 2026 the CRA reasonable per-kilometre rate is 73 cents for the first 5,000 business kilometres driven in the year and 67 cents for each kilometre after that. In the Northwest Territories, Yukon and Nunavut both figures rise by 4 cents, to 77 cents and 71 cents. It is the rate for a tax-free allowance an employer pays an employee.
How does the 5,000 km tier work?
The threshold is cumulative across the whole tax year, not per trip. You apply the higher rate to your first 5,000 business kilometres in the year, then the lower rate to everything beyond that. The count resets at the start of each tax year.
Is the CRA mileage rate the same in every province?
Yes, apart from the territories. The rate is federal, so Ontario, Alberta, British Columbia and every other province use the same per-kilometre figures. Only the Northwest Territories, Yukon and Nunavut differ, adding 4 cents per kilometre.
Can I deduct the CRA per-kilometre rate if I'm self-employed?
No. The per-kilometre rate is the reasonable allowance an employer can pay an employee without it being taxed. If you're self-employed and file a T2125, you deduct the business-use share of your actual vehicle expenses (fuel, insurance, maintenance and repairs, licence and registration, lease payments or loan interest) on line 9281, and claim capital cost allowance on the vehicle on line 9936. Your business-use share is business kilometres divided by total kilometres driven in the year, supported by a logbook.
Do I still need a logbook?
Yes. The CRA expects a record showing the date, destination, purpose and distance of each business trip, plus your total kilometres for the year, because your claim depends on the business-use share. The rate tells you what an employer can pay per kilometre; the logbook proves the kilometres happened.
My employer pays me a per-kilometre allowance. Can I also deduct my fuel?
Generally not, if the allowance is reasonable and tax-free. An employee can deduct vehicle expenses only in specific cases, such as when the employer requires you to pay your own vehicle costs and signs Form T2200, and a tax-free allowance usually rules that out. Confirm your situation with the CRA or your accountant.
Is this tax advice?
No. These are the published rates and general guidance to help you estimate. Rates change annually and eligibility depends on your circumstances, so confirm the current figures and method with the CRA or your accountant before you file.
General guidance, not tax advice. Rates change annually; confirm with the CRA or your accountant.