Question

Jane is an employee for ABC Ltd. and during the current year she received a salary of $60,000. Jane worked away from the office visiting clients, and she is required to pay her own travelling expenses. In addition, Jane drives her own vehicle for employment purposes. Jane purchased the vehicle several years ago and has been depreciating her vehicle for tax purposes for many years. The opening UCC balance for her vehicle (Class 10) is $25,000 in the current year. Her employer has signed a Form T2200 certifying that requirement and that no reimbursements are paid for any expenses Jane incurs to earn employment income. Jane incurred the following vehicle costs in the current year: Driving costs (80% of driving was for employment purposes): Fuel $4,000.00 Insurance $750.00 Repairs $2,250.00 What is the maximum deduction Jane can claim for travel and motor vehicle expenses this year? What is Jane's net employment income for the current year?

Answer 1

.Below is the table for Jane's Income Statement

Jane's Yearly Salary		60000
Vehicle Cost (80% considerable)
Fuel	3200
Insurance	600
Repairs	1800
dep	6000	11600
Income before Tax		48400
Federal Tax	5411
Provincial Tax	1936	7347
Net Income for Jane		41053

Notes_

Since, Jane uses 80% of the driving for business purpose, her fuel, insurance , repairs etc are calculated accordingly.

CCA rate is 30% of the UCC value.