Personal Finance

Bought a car last year. How does that affect my tax return?

  • Last Updated:
  • Feb 28th, 2012 12:28 am
Tags:
None
[OP]
Newbie
Aug 16, 2009
76 posts
5 upvotes

Bought a car last year. How does that affect my tax return?

Hey everyone, I was just about done with my taxes when I realized that I bought my car last year and was wondering if that had any implications on my taxes. Where do I fill it it, how does it work?

Thanks
25 replies
Deal Fanatic
User avatar
Nov 23, 2005
8292 posts
4014 upvotes
What does a car purchase have with your taxes? Unless the vehicle is for business use, I don't see why/how your purchase would have an impact on your tax return, unless I am missing something here.
Deal Addict
User avatar
Sep 26, 2007
3960 posts
146 upvotes
SC
if it's for personal use it doesn't.

even if u sold your old car and had a capital loss, you would not be able to claim that loss because it was for personal use.
however as said, not the same if it's for business.
"We don't have a soul... We are a soul. We have a body." ~C.S Lewis
Deal Addict
Jul 8, 2009
2028 posts
479 upvotes
Edmonton
No, of course not. It's a personal expense.
Sr. Member
Sep 24, 2010
917 posts
64 upvotes
Toronto
I believe there is no tax implication of buying or using the car unless it is for business and also in some limited cases, the mileage or gas might be able to be claimed against the rental income. But I think there are some restrictions on claiming the car expenses.
Deal Addict
User avatar
May 15, 2010
2000 posts
113 upvotes
North York
Hey everyone I bought me a new pair of jeans from that abercrombie thread in the hot deals section, how does this affect my tax return?
Member
Apr 20, 2008
231 posts
37 upvotes
Wing Nut wrote:
Feb 25th, 2012 6:49 pm
No, of course not. It's a personal expense.
what if s/he registered the car as a personal vehicle, but used it for business purposes. OF course i am referring to the self-employed situation. Can it be claimed as expense then?

Dilton wrote:
Feb 25th, 2012 8:14 pm
Hey everyone I bought me a new pair of jeans from that abercrombie thread in the hot deals section, how does this affect my tax return?

you've got less $ to pay taxes from?
Deal Addict
User avatar
Nov 3, 2002
1316 posts
61 upvotes
Ottawa
ahm2307 wrote:
Feb 25th, 2012 5:27 pm
Where do I fill it it...?

Same place you mark down your gas and grocery expenses.
Deal Addict
Jun 20, 2009
1049 posts
46 upvotes
MoneyAndWealth wrote:
Feb 26th, 2012 7:57 am
As others have stated it doesn't impact your taxes unless you use the vehicle for business purposes. If you do use it for business purposes then you can deducat a portion (or all) of the monthly payment (or lease), financing costs, insurance, gas, maintenance etc.

Really, wow. Does it matter what business you have, or can it be for any business regardless of the services the business provides?
Deal Fanatic
Apr 16, 2007
7119 posts
2022 upvotes
Financial District B…
ahm2307 wrote:
Feb 25th, 2012 5:27 pm
Hey everyone, I was just about done with my taxes when I realized that I bought my car last year and was wondering if that had any implications on my taxes. Where do I fill it it, how does it work?

Thanks


Wow, so many wrong answers on this thread.


You don't have to be BFS (business for self) to claim automotive expenses on your income tax return.
If you are self employed (you haven't said so in your posting) then your accountant or tax preparer will know how to claim it on your T1 General.

Now, if you are employed for a business as a fulltime employee and if your employer sent you out for deliveries, sales calls, visiting clients, pick-up packages, parking fees etc or anything in that nature with your own personal vehicle then you can claim all that plus fuel and maintenance costs(note: your $$ amount will be predicated on usage)
All you need is a signed T2200-11e or T4044 form from your employer
Your expenses claimed can include and GST/HST you paid too.
If you are a hourly-paid or salaried employee then you may also need to fill out T777-11e form
Deal Addict
Jun 20, 2009
1049 posts
46 upvotes
mikeymike1 wrote:
Feb 26th, 2012 9:13 am
Wow, so many wrong answers on this thread.


You don't have to be BFS (business for self) to claim automotive expenses on your income tax return.
If you are self employed (you haven't said so in your posting) then your accountant or tax preparer will know how to claim it on your T1 General.

Now, if you are employed for a business as a fulltime employee and if your employer sent you out for deliveries, sales calls, visiting clients, pick-up packages, parking fees etc or anything in that nature with your own personal vehicle then you can claim all that plus fuel and maintenance costs(note: your $$ amount will be predicated on usage)
All you need is a signed T2200-11e or T4044 form from your employer
Your expenses claimed can include and GST/HST you paid too.
If you are a hourly-paid or salaried employee then you may also need to fill out T777-11e form

What if I own a business, make 20k a year from it, but im also in school. Can I claim my school tuition on my taxes, then claim my car & it's running expense on my taxes either?
What is there to prevent people from claiming more for expense than what it costs them?
Deal Fanatic
Apr 16, 2007
7119 posts
2022 upvotes
Financial District B…
virgilaug wrote:
Feb 26th, 2012 11:53 am
What if I own a business, make 20k a year from it, but im also in school. Can I claim my school tuition on my taxes, then claim my car & it's running expense on my taxes either?
What is there to prevent people from claiming more for expense than what it costs them?

You can't. Don't be ridiculous.
Everything must be within reason and justifiable. Read what I wrote: your $$ amount will be predicated on usage
You can't claim 20k if your income is only 20k.

Being audited - That's what prevents people from being stupid from claiming crazy amounts that totally makes no sense.
Deal Addict
Jun 20, 2009
1049 posts
46 upvotes
mikeymike1 wrote:
Feb 26th, 2012 12:01 pm
You can't. Don't be ridiculous.
Everything must be within reason and justifiable. Read what I wrote: your $$ amount will be predicated on usage
You can't claim 20k if your income is only 20k.

Being audited - That's what prevents people from being stupid from claiming crazy amounts that totally makes no sense.

I know. That would be so obvious if I made 20k and claimed 20k.

But what If I made 20k, bought a car for 5k, factored in gas and insurance say 5-6k, and then bought some equipment like a computer 1.5k, plus tuition say 6k. Total of 17.5k - 18.5k in claims. That seems reasonable right?

In later years it would obviously be less because I would not have to buy a car.
Sr. Member
Aug 29, 2004
871 posts
145 upvotes
virgilaug wrote:
Feb 26th, 2012 1:26 pm
I know. That would be so obvious if I made 20k and claimed 20k.

But what If I made 20k, bought a car for 5k, factored in gas and insurance say 5-6k, and then bought some equipment like a computer 1.5k, plus tuition say 6k. Total of 17.5k - 18.5k in claims. That seems reasonable right?

In later years it would obviously be less because I would not have to buy a car.

If you made 20k and claimed 20k, expect to get audited. There isn't anything wrong with that so long as you actually spent that much and can back it up, and are ready to get audited. It would however mean that after "reasonable" business expenses you made no money.

Top