The Quebec government has confirmed that they are harmonizing the Automobile Deduction limits for 2025 with the Federal Government.
Effective January 1, 2025, the general prescribed rate used to determine the taxable benefit for employees relating to the personal portion of automobile expenses paid by their employers will increase from 33 to 34 cents per kilometre. For people employed principally in selling or leasing automobiles, the rate used to determine the employee’s taxable benefit will increase from 30 to 31 cents per kilometre. The limit on the deduction of tax-exempt allowances paid by employers to employees who use their personal vehicle for business purposes in all jurisdictions increased from 70 to 72 cents per kilometre for the first 5,000 kilometres driven and from 64 to 66 cents for each additional kilometre.
For the territories, the deductible limit for tax-exempt allowances paid by employers to employees is increased to 76 cents for the first 5,000 kilometres travelled and 70 cents for additional kilometres.
Employers must adhere to the Quebec Ministry of Finance’s prescribed rates when providing non-taxable per-kilometre allowances to employees.