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Car Allowance and Personal Taxable Benefits


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I was hoping someone could help me with a question on reporting car allowances and personal taxable benefits as well as adding vehicle expenses to my tax return. This is my first year filing with vehicle expenses.

On my T4 my employment income includes my $12,000.00 a year car allowance in box 14. The same amount is included in box 40 of my tax return, along with my Personal Taxable Benefit amount of $1,726.47 from my expense reports.

My final pay stub for 2023 shows my total earnings as $104,726.71 less taxable benefits of $1726.47 for a total gross of $103,000.24. Should this not be the amount reported in box 14? Why is my vehicle allowance of $12,000.00 reported in both box 14 and box 40? Is this an error by my employer? Or am I looking at this wrong? 

T777 Line 3 for calculation of allowable motor vehicle expenses says to enter the total of all rebates, motor vehicle allowances, and reimbursements for motor vehicle expenses you received that are NOT included in income. As my car allowance is already included in Box 14 and Box 40 of my T4 I assume this means I do not enter it again here? If I leave it blank vs adding in the $12,000.00 there is almost a $3,000.00 difference on what I would get back on my tax return so I want to make sure I am entering this correctly.

Any assistance would be greatly appreciated. Thanks!

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Hello Sarah163,


Box 40 - Other taxable allowances and benefits

Do not report this amount on your tax return. This amount is already included in box 14.
https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/about-your-tax-return/tax-return/completing-a-tax-return/tax-slips/understand-your-tax-slips/t4-slips/t4-statement-remuneration-paid.html

 

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