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New Member

Would the cost of renewing a drivers license qualify for a business expense under the "license and registration" portion of the motor vehicle expenses for small business?

 
4 Replies
Moderator

Would the cost of renewing a drivers license qualify for a business expense under the "license and registration" portion of the motor vehicle expenses for small business?

This surely got me thinking and after a little searching came up with some information. Nowhere, including CRA documentation, is it very clear what "License and Registration" cover with the claiming of your Motor Vehicle Expenses on your income tax return.

Registration is "not" to be confused with your auto insurance. Registration may only be paid once when you purchase a vehicle. It seems it might be a separate payment depending on which province you are in, and may or may not be included with your insurance policy

However, most insurance policies do show a "license fee", (possibly an "annual license fee") that is included with your insurance. Very often people do not do the breakdown and separate this expense out from the insurance policy itself, claiming it with the insurance. 

Hope this helps....thanks for getting me thinking 🙂

New Member

Would the cost of renewing a drivers license qualify for a business expense under the "license and registration" portion of the motor vehicle expenses for small business?

Agreed, "Insurance" is it's own category entirely under Motor Vehicle Expenses.  I'm not sure where you are located, I'm in Ontario, and my insurance is laid our very basically.  My monthly premium is spelled out clearly, and there is nothing related to licensing or registration in conjunction with insurance that I can find.  I suppose I may have been misinterpreting the "registration," and I do agree that it seems more like a one time thing when you first purchase the car, and register it in your province, typically done by the dealer, or if private sale you would usually go in yourself and do the paperwork.  Considering that "Licensing and Registration" are together on the tax forms, it would make sense that the intention is more of the one time payment type of thing, despite the vagueness of the heading.  Thanks again for your help, maybe it's worth a call to the CRA for clarification.
Moderator

Would the cost of renewing a drivers license qualify for a business expense under the "license and registration" portion of the motor vehicle expenses for small business?

No, the cost of renewing your Driver's License is a personal expense. Deductible license and registration fees are the fees you would pay on your motor vehicle's insurance policy. 

New Member

Would the cost of renewing a drivers license qualify for a business expense under the "license and registration" portion of the motor vehicle expenses for small business?

Great, thanks for your answer.  Would you be able to tell me what they are referring to then in regards to "license"?  I presume the registration would be the stickers I purchase annually for my plates, but I can't really think of what other license it could mean.