If you use your personal vehicle for work in Canada, the CRA mileage rate 2026 provides an important benchmark for calculating a reasonable automobile allowance.
The Canada Revenue Agency publishes prescribed per-kilometre rates that employers can use when reimbursing employees for business driving. This guide explains the current 2026 rates, territorial adjustment and calculation method.
Quick answer: CRA mileage rate 2026
- Provinces: 73¢/km for the first 5,000 km, then 67¢/km
- Yukon, Northwest Territories, Nunavut: 77¢/km for the first 5,000 km, then 71¢/km
- Up 1¢ on every tier from 2025 (72¢/66¢)
Verified against the Department of Finance Canada announcement of January 14, 2026. Some websites and calculators still show the 2025 figures.
What Is the CRA Mileage Rate?
The CRA mileage rate commonly refers to the prescribed cents-per-kilometre automobile allowance rate. Instead of reimbursing fuel, insurance, maintenance, depreciation and other vehicle costs separately, an employer can pay an allowance based on business kilometres driven.
Business kilometres × applicable rate = mileage allowance
CRA Mileage Rate 2026
| Location | First 5,000 km | Each additional km |
|---|---|---|
| Canadian provinces | $0.73/km | $0.67/km |
| Yukon, Northwest Territories and Nunavut | $0.77/km | $0.71/km |
These are the 2026 prescribed rates under section 7306 of the Income Tax Regulations. They are one cent higher than the corresponding 2025 rates.
Why Are the First 5,000 Kilometres Different?
Vehicle ownership includes costs that do not increase proportionally with each kilometre. The system therefore applies a higher rate to the first 5,000 annual business kilometres and a lower rate after that threshold.
A driver with 3,500 business kilometres applies the first-tier rate to every kilometre. A driver with 8,000 kilometres applies the first-tier rate to 5,000 km and the second-tier rate to the remaining 3,000 km.
How to Calculate CRA Mileage Reimbursement
For 7,500 business kilometres in a province:
- First 5,000 km: 5,000 × $0.73 = $3,650
- Additional 2,500 km: 2,500 × $0.67 = $1,675
- Total estimated allowance: $5,325
Using one rate for all kilometres would give the wrong result once annual business travel exceeds 5,000 km.
Example: Employee Drives Less Than 5,000 km
An employee in Ontario drives 4,000 business kilometres in 2026:
4,000 × $0.73 = $2,920
The estimated reasonable allowance is $2,920, subject to the other CRA conditions.
Example: Employee Drives More Than 5,000 km
An employee in Alberta drives 12,000 business kilometres:
- 5,000 × $0.73 = $3,650
- 7,000 × $0.67 = $4,690
- Total: $8,340
Example: 2026 Territorial Rate
An employee whose vehicle is registered in Yukon drives 7,500 qualifying kilometres:
- 5,000 × $0.77 = $3,850
- 2,500 × $0.71 = $1,775
- Total: $5,625
What Counts as Business Kilometres?
Business driving generally involves travel required to perform employment duties. Depending on the circumstances, this can include travel:
- Between work locations.
- To visit clients or customers.
- To attend business meetings.
- To a temporary work location.
- To perform duties away from the regular workplace.
Personal driving must be kept separate from business kilometres.
Does Commuting Count as Business Mileage?
Ordinary travel between home and a regular workplace is generally personal commuting, not business mileage. A trip from the regular office to a client location may be employment-related, while the home-to-office trip usually is not.
CRA Mileage Rates in the Territories
Yukon, Northwest Territories and Nunavut receive an additional four cents per kilometre in 2026. That produces rates of $0.77 for the first 5,000 km and $0.71 for additional kilometres.
Is CRA Mileage Reimbursement Taxable?
A reasonable allowance based only on actual business kilometres can be treated differently from a flat vehicle allowance. The structure matters: a reasonable per-kilometre amount based on employment-related kilometres is different from a fixed monthly payment unrelated to distance.
Employers should distinguish between a kilometre-based allowance, a reimbursement of specific receipts and a flat automobile allowance when determining payroll treatment.
The Catch: Self-Employed People Can’t Use the 73¢ Rate
The cents-per-kilometre rate is an employer-to-employee allowance benchmark. If you are self-employed (a sole proprietor, freelancer or contractor), you cannot simply multiply your kilometres by 73¢ and deduct the result.
Instead, you claim the business-use percentage of your actual vehicle expenses: fuel, insurance, maintenance and repairs, licence and registration, lease payments or capital cost allowance, and eligible interest. For example, if 6,000 of your 20,000 km in the year were for business, you can generally claim 30% of those costs. A mileage log is how you prove that percentage.
Incorporated owners who pay themselves a per-kilometre allowance as employees of their corporation are in a different position. Check the rules for your situation or ask an accountant.
Other 2026 Automobile Limits From Finance Canada
| 2026 limit | Amount |
|---|---|
| Operating expense benefit (employer-provided car) | 34¢/km (31¢/km for employees mainly selling or leasing cars) |
| Capital cost allowance ceiling, passenger vehicles (Class 10.1) | $39,000 before tax (up from $38,000) |
| Capital cost allowance ceiling, zero-emission vehicles (Class 54) | $61,000 before tax |
| Leasing deduction limit | $1,100 per month before tax |
| Interest deduction limit | $350 per month |
The operating expense benefit rate applies when an employer provides a vehicle and pays its operating costs, which is a different situation from paying an employee for driving their own car. Some sites list it as 35¢ for 2026; the official figure is 34¢.
Why You Should Keep a Mileage Log
A useful log records the date, destination, trip purpose, business kilometres and odometer readings where appropriate. Maintaining records throughout the year is easier and more reliable than reconstructing trips later.
| Date | Trip | Purpose | Business km |
|---|---|---|---|
| Jan 8 | Office → Client A | Client meeting | 24 |
| Jan 10 | Office → Site B | Site inspection | 42 |
| Jan 14 | Office → Client C | Project meeting | 31 |
| Jan 18 | Office → Supplier | Business purchase | 18 |
Total business kilometres: 115 km.
CRA Mileage Rates Change by Year
Rates can change as fuel, insurance, maintenance and vehicle costs change. Always match the travel year to the prescribed rate, particularly around January when older calculators may still display the previous year’s figures.
Here are the CRA’s prescribed reasonable per-kilometre allowance rates for every year from 2015 to 2026. Yukon, the Northwest Territories and Nunavut get 4 cents more per kilometre.
| Year | Provinces: first 5,000 km | Provinces: each additional km | Territories: first 5,000 km | Territories: each additional km |
|---|---|---|---|---|
| 2026 | $0.73/km | $0.67/km | $0.77/km | $0.71/km |
| 2025 | $0.72/km | $0.66/km | $0.76/km | $0.70/km |
| 2024 | $0.70/km | $0.64/km | $0.74/km | $0.68/km |
| 2023 | $0.68/km | $0.62/km | $0.72/km | $0.66/km |
| 2022 | $0.61/km | $0.55/km | $0.65/km | $0.59/km |
| 2021 | $0.59/km | $0.53/km | $0.63/km | $0.57/km |
| 2020 | $0.59/km | $0.53/km | $0.63/km | $0.57/km |
| 2019 | $0.58/km | $0.52/km | $0.62/km | $0.56/km |
| 2018 | $0.55/km | $0.49/km | $0.59/km | $0.53/km |
| 2017 | $0.54/km | $0.48/km | $0.58/km | $0.52/km |
| 2016 | $0.54/km | $0.48/km | $0.58/km | $0.52/km |
| 2015 | $0.55/km | $0.49/km | $0.59/km | $0.53/km |
Use the rate for the year the driving took place. For example, kilometres driven in December 2025 use the 2025 rates, even if the reimbursement is paid in January 2026.
Calculate Your 2026 Mileage Allowance
Enter business kilometres, province or territory and tax year. The calculator separates the first 5,000 km, additional kilometres and territorial adjustment. Its private mileage log stays in your browser.
Use the CRA Mileage Calculator 2026 →
The calculator provides an estimate and is not tax or payroll advice.
Is the CRA Mileage Rate Different in Ontario, BC or Alberta?
No. For the general per-kilometre allowance, every province uses the same 73¢/67¢ rate in 2026, and only the three territories are higher. Some websites show different per-province numbers because the CRA also publishes separate quarterly travel rates for its own employees. See our 2026 mileage rates by province guide for the full breakdown.
Printable 2026 CRA Mileage Rate Summary
| 2026 | First 5,000 km | Each additional km |
|---|---|---|
| Provinces | $0.73 | $0.67 |
| Territories | $0.77 | $0.71 |
To keep a PDF copy, use your browser’s Print → Save as PDF on this page, or download the official rates from the CRA page linked in the sources below.
Frequently Asked Questions
What is the CRA mileage rate for 2026?
In the provinces, the 2026 prescribed rates are $0.73 per kilometre for the first 5,000 km and $0.67 for each additional kilometre.
What are the 2026 rates in the territories?
Yukon, Northwest Territories and Nunavut use $0.77 for the first 5,000 km and $0.71 for additional kilometres.
Is there one rate for every kilometre?
No. The prescribed structure uses one rate for the first 5,000 business kilometres and another for kilometres above 5,000.
Does driving to work count as business mileage?
Normal commuting between home and a regular workplace is generally personal travel.
Do I need a mileage log?
Accurate records of employment-related trips help support the business-kilometre calculation.
Does the CRA mileage rate change every year?
It can. Always check the prescribed rate for the year in which the travel occurs.
Can self-employed people use the CRA mileage rate?
No. The per-kilometre rate is for employer-paid allowances. Self-employed people deduct the business-use percentage of their actual vehicle expenses, supported by a mileage log.
What is the operating expense benefit rate for 2026?
34 cents per kilometre, or 31 cents for employees whose main job is selling or leasing cars, according to Finance Canada.
Is there a PDF of the 2026 CRA mileage rates?
The CRA publishes the rates on canada.ca. You can also print this page or the summary table above with your browser’s “Save as PDF” option.
Official Sources
- Canada Revenue Agency: Automobile allowances and prescribed rates
- Department of Finance Canada: 2026 automobile rates
Final Thoughts
The CRA mileage rate 2026 is an important benchmark for Canadian employers and employees calculating allowances based on business kilometres. Keep accurate records, separate business travel from personal commuting and apply the correct tier and location.
. Official rates, 2015–2026 table, examples and a free calculator.){kind=link}