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Treasury Board Travel Directive - Policy for Allowances
CRA has its own limits it considers a reasonable non-taxable allowance for automobiles. Click HERE for more.
Taxpayers may want to consider that the Federal Government Treasury Board Travel Directive Policy on Tax-Free allowances for Federal Employees should apply. However, CRA may object to the reasonability of these amounts and therefore caution is warranted. The Treasure Board of Canada has negotiated these rates with the unionized employees and are part of a legal contract in the Collective Agreement. Therefore, they may not apply in other circumstances. Contact Keith Anderson CA, for more information.
The Treasury Board amounts are as follows:
Automobiles
Note that the Treasury Board Guidelines include a statement that the kilometric rate payable when a Canadian registered vehicle is driven on government business travel in more than one province or in the USA shall be the rate applicable to the province or territory of registration of the vehicle.
Meals, Accommodation, and Incidental Allowances
CRA also notes that generally reasonable allowances for meals and accommodations paid to employees in Special or Remote Work Sites are also non-taxable benefits to the employees and are deductible (within limits - click HERE for more) to the employers. CRA does not publish any policy on what they consider a reasonable amount. Taxpayers can argue that the amounts in the Federal Government Treasury Board Travel Policy on Tax-Free Meals and Accommodation are reasonable amounts. However, CRA may disagree with the reasonability of these amounts. These daily amounts are in Canadian dollars and include taxes. For US travel the amounts are the same only paid in US dollars. The amounts are as follows:
Any of the above allowances may be replaced with a reimbursement to the employee of actual expenses. Click HERE for a discussion on the automobile reimbursement issue.
Click HERE for more discussion on the deductibility to the employer on Meals and Entertainment.
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