CRA Mileage Rate by Province: Why Ontario and Manitoba Are the Same

There is no Ontario rate, no Manitoba rate, and no New Brunswick rate. The CRA business allowance limit is 73 cents per kilometre for the first 5,000 kilometres in every one of the ten provinces, and 67 cents for each kilometre after that. Only the three territories differ, at 77 and 71 cents. If you have been searching for a province-specific number, the reason you cannot find one is that it does not exist.

Source: Department of Finance Canada, Government Announces the 2026 Automobile Deduction Limits and Expense Benefit Rates for Businesses, January 14, 2026. Verified August 2026.

The 2026 rates, in full

• Provinces: 73 cents per kilometre for the first 5,000 business kilometres, 67 cents for each additional kilometre
• Northwest Territories, Yukon, and Nunavut: 77 cents for the first 5,000 kilometres, 71 cents thereafter
• Both figures rose by one cent effective January 1, 2026

The territorial supplement is a flat four cents, and it exists because operating a vehicle in the territories genuinely costs more. It is the only geographic variation in the entire table.

So why do province-specific numbers keep turning up?

Because three different rate systems get called the same thing, and two of them really do vary by jurisdiction.

1. The CRA business allowance limit. National, 73 and 67 cents, with the territorial supplement. This is the figure that caps what an employer can pay you tax-free per kilometre.
2. The CRA simplified travel rate. Genuinely per-province, and used for medical travel, moving expenses, and the northern residents deduction. It runs from 55.5 cents in Saskatchewan to 70.5 in Nunavut. See the full per-province table.
3. Provincial government travel rates. Each province sets its own reimbursement rate for its own public-sector employees. These are employment policies, not tax rules, and they have no bearing on what a private employer may pay or what you may deduct.

A search for a provincial mileage rate usually surfaces the third category, which is why the numbers look authoritative and turn out to be irrelevant to almost everybody who finds them.

What the 5,000 kilometre tier actually means

The two-tier structure applies per employee per calendar year, and the tier is based on business kilometres driven, not total kilometres. Work an example at 12,000 business kilometres in a province:

• First 5,000 kilometres at 73 cents: $3,650
• Remaining 7,000 kilometres at 67 cents: $4,690
• Total tax-free allowance: $8,340

Apply the 73 cent rate to all 12,000 kilometres and you get $8,760, an overpayment of $420. Anything paid above the limit is not automatically disallowed, but the excess stops being a tax-free allowance and becomes a taxable benefit to the employee.

The other 2026 automobile figures

The same Department of Finance announcement set the rest of the year's vehicle limits, which matter if you own the vehicle through a business rather than claiming an allowance.

• Class 10.1 passenger vehicle capital cost allowance ceiling: rose from $38,000 to $39,000 before tax, for vehicles acquired on or after January 1, 2026
• Class 54 zero-emission passenger vehicle ceiling: unchanged at $61,000 before tax
• Deductible leasing costs: unchanged at $1,100 per month before tax
• Maximum deductible interest on a new automobile loan: unchanged at $350 per month
• General prescribed operating benefit rate: unchanged at 34 cents per kilometre, or 31 cents for employees principally selling or leasing automobiles

Reasonable allowance, and when it stops being one

For a per-kilometre allowance to be tax-free, CRA requires it to be reasonable, based solely on business kilometres driven, and not combined with a reimbursement of the same expenses. A flat monthly car allowance fails the second test immediately, because it is not tied to kilometres at all, and is taxable in full.

Paying an employee a flat $500 a month plus 73 cents per kilometre also fails, because it doubles up. In both situations the payment lands on the employee's T4 as income, which is a worse outcome for everyone than simply running the per-kilometre allowance properly.

Do I get the territorial rate if I drive into a territory?

The territorial rate applies to travel in the Northwest Territories, Yukon, and Nunavut. A short trip across the border does not convert an entire year of provincial driving to the higher rate, so kilometres driven in each place need to be identifiable.

Is the rate different for self-employed people?

Yes, and this is a common misunderstanding. The 73 cent figure is a limit on tax-free allowances paid by an employer. If you are self-employed, you do not use a per-kilometre rate at all: you deduct the business-use share of your actual vehicle costs on Form T2125, which means keeping receipts as well as a kilometre log.

How far back do the rates go?

The 2025 figures were 72 and 66 cents, and the rate has been adjusted most years. Our CRA rate history lists the earlier years if you are filing or amending a prior return.

The two-tier rate only works if you know exactly which kilometres were business. TruMile tracks and classifies every trip automatically, so the 5,000 kilometre threshold is a fact, not an estimate. Try TruMile →

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