October 12, 2021

Driversnote’s 2021 mileage reimbursement calculator is based on the CRA mileage rate for 2021. You can use the calculator below to get an overview of how much you can receive as vehicle mileage reimbursement for this year and calculate your work mileage. If you are looking for a mileage logbook or a mileage tracker - check out the automatic Driversnote app instead.

Calculating with the current rates

The CRA sets a standard mileage rate each year which is used to calculate your mileage reimbursement. The 2022 CRA mileage rate is \$0.61 for the first 5000km driven for business. Keep in mind this calculator is useful only for trips made before January 2022! The CRA mileage rate for 2021 is 59¢ per kilometre for the first 5,000 kilometres driven and 53¢ per kilometre above that.

Use the calculator below to estimate the reimbursement you are entitled to.

If you would like to calculate your mileage reimbursement manually, you can do so by following the example below:

Let’s imagine that it is the end of the year and your logbook shows a total of 12,000 km for business purposes.

All you need to do is multiply the 11,000 km by the mileage rate. However, you need to remember that the first 5000 km and the km after that have a different mileage rate. Up to 5000 km, the CRA mileage rate for 2022 is 61¢ and after 5000km it is 55¢. Therefore you would calculate your reimbursement like this:

5000 (first 5000km) x 0.61 = \$3050 (Your reimbursement for the first 5000km)

6000 (Remaining km) x 0.55 = \$2750 (Your reimbursement for the km after the first 5000)

Now combine the two to get the total mileage reimbursement:

3050 + 2750= \$5800

If you have logged everything perfectly in your mileage logbook, there should be no reason for you not to get reimbursed. You can use the Driversnote mileage tracking app to make sure you never miss logging a trip and quickly generate compliant mileage reports.

How to use the mileage calculator for Canada

When employees use their vehicles for business purposes, mileage reimbursement is used to compensate them for the mileage expenses incurred. Apart from being reimbursed for mileage, if you are self-employed you have the option to be compensated for expenses related to maintenance and repairs.

Some of the possible reimbursements are:

• Licence and registration costs
• Fuel and oil
• Electricity (for zero-emission vehicles)
• Insurance
• Costs for maintenance and repairs
• Leasing costs
• Interest on money borrowed to buy the motor vehicle

The mileage reimbursement calculator provided above is a great way for you to find the overall reimbursement you are entitled to based on the CRA mileage rate for 2021. However, in order to get reimbursement you must keep all receipts and a proper mileage log of all your trips. For any trips logged after January 2022, remember that you need to use the new CRA mileage rate for 2022

In order to receive the calculated mileage reimbursement, you must be able to prove that you have driven kilometres for business purposes. You must also provide receipts for any other expenses you can have reimbursement for as self-employed. The easiest way to do this is by keeping a mileage logbook where you write all the necessary information. Simply using the calculator to estimate your reimbursement is not enough for you to be paid out.

How to prepare for calculating your reimbursement

By keeping track of your mileage and total car expenses in a logbook, whether it's an Excel sheet, a PDF, a physical notebook or an app, you can determine your work-related car expense deductions.

One thing to remember when keeping a mileage logbook is that if you use the same vehicle for business and private purposes, then you need to log both types of trips. That is because you will need to be able to show the exact percentage your vehicle was used for business purposes. The CRA requires you to keep your records for six years from when you turn in your tax return, in case they need you to substantiate your claims.

What should a logbook include?

There are a couple of different ways to keep a logbook but the basic things you must not forget to always track according to the CRA are:

• Total distance driven for the year
• Breakdown of business vs personal use
• Expenses for the vehicle

Furthermore, for all trips you must record the following:

• Date
• Destination
• Purpose; and
• Number of kilometres driven