Vehicle Expense Methods: Actual vs Per-Kilometre (Mileage) for Delivery Drivers — CPA Firm Near You, Montreal

Introduction

Delivery drivers in Quebec — whether working for Uber Eats, SkipTheDishes, DoorDash, Amazon Flex, restaurants, or courier companies — often struggle with how to claim vehicle expenses correctly. CRA and Revenu Québec allow two methods: the actual expense method and the per-kilometre (mileage) method. Choosing the wrong method or failing to track logs properly can lead to denied deductions or an unexpected tax bill. This guide explains both methods, their advantages and drawbacks, and how a CPA firm near you in Montreal can help drivers stay fully compliant.

Legal and Regulatory Framework

Under the Income Tax Act and the Taxation Act of Quebec, delivery drivers who are self-employed may deduct vehicle expenses using one of two approaches:

1. Actual Expense Method

Drivers track:
• Fuel
• Repairs and maintenance
• Oil, tires, car washes
• Insurance
• Leasing costs or interest on vehicle loans
• Registration and license fees
• Depreciation (capital cost allowance)

Expenses are deducted based on business-use percentage:
Business km / Total km × Actual vehicle costs.

2. Per-Kilometre (Simplified Mileage) Method

Drivers claim a fixed CRA rate per kilometre driven for business purposes.
This method is simpler but may produce a smaller deduction if actual expenses are high.

Mileage rates vary by year and province.

GST/QST Considerations

Self-employed delivery drivers must charge and remit GST/QST once they exceed the small-supplier threshold. ITCs/ITRs depend on which method they use.

Key Court Decisions

Courts have consistently ruled that:
• Mileage logs are mandatory — estimates are not accepted
• Personal trips must be excluded
• Expenses cannot be claimed without supporting receipts
• Vehicle purchases require correct CCA classifications
• Mixed-use vehicles need accurate business-use percentages

Judges often deny deductions when logs are missing or incomplete.

Why CRA and Revenu Québec Target Delivery Drivers

Delivery drivers are frequently audited because:
• Platform income (Uber Eats, DoorDash, etc.) is automatically reported to CRA
• Mileage logs are often missing
• Cash tips may go unreported
• Personal and business kilometres are mixed
• Vehicle expenses are frequently overstated
• GST/QST registration is often ignored

Auditors compare app delivery histories, odometer readings, fuel receipts, and banking records.

Mackisen Strategy

At Mackisen CPA Montreal, we help delivery drivers choose the best method and build audit-proof documentation systems. We:
• Compare actual vs mileage method to maximize deductions
• Set up mileage logs and record-keeping tools
• Track fuel and operating expenses correctly
• Apply GST/QST rules based on driver revenue
• Prepare year-end tax filings and optimize business-use allocations
• Reconcile app payout statements with tax returns
• Prepare audit-ready documentation packages

Real Client Experience

A Montreal delivery driver claimed 100 percent of vehicle costs with no logs. CRA denied the claim. We rebuilt mileage logs using app delivery records, GPS data, and maintenance logs — restoring part of the deduction. Another driver saved thousands by switching from the mileage method to actual expenses after buying a new vehicle.

Common Questions

Which method is better?

Actual expense method usually gives a larger deduction when vehicle costs are high. Mileage is simpler when costs are low.

Do I need a mileage log?

Yes — both methods require mileage tracking for business vs personal use.

Can I switch methods?

Yes, but only at the beginning of a tax year.

Are tips taxable?

Yes. All tips (cash or digital) must be included in income.

Why Mackisen

With more than 35 years of combined CPA experience, Mackisen CPA Montreal helps delivery drivers maximize vehicle deductions while staying fully compliant. Whether you deliver part-time or full-time, our expert team ensures precision, transparency, and audit protection.