If you drive for your practice, between clinics, out to clients, or to pick up supplies, you can deduct the business share of your vehicle costs. The catch is you need a logbook, and your daily commute to one regular workplace does not count.
Your car is probably costing you more than you think, and a real chunk of it may be deductible. The rules are not complicated once you see them, but they do hinge on one habit most people skip: keeping track of your kilometres.
What counts as business driving
Business driving is travel you do to earn your income. For a clinician, that usually means:
- Driving between two clinics or work locations in a day
- Travelling to see a client or patient
- Trips to pick up supplies, do banking, or meet your accountant
What does not count is your regular commute. Driving from home to the one clinic you always work at is personal, the same as it would be for an employee. The exception is if your home is your main place of business, in which case trips from there to other work locations can count.
The logbook is everything
Your deduction is based on how much of your driving is for business. So you track your business kilometres and your total kilometres for the year, and the business share is simply one divided by the other. Drive 18,000 kilometres in a year and 6,000 are for the practice, and a third of your vehicle costs are in play.
A phone app that logs trips automatically is more than enough. Without some record, the claim is hard to defend, so this is the one habit worth building.
What you can deduct
Once you have your business percentage, you apply it to the real costs of running the vehicle:
- Fuel and oil
- Insurance
- Licence and registration
- Maintenance and repairs
- Interest on your car loan, or your lease payments
- A portion of the vehicle’s cost itself, claimed gradually over time
The HST angle
This is where physiotherapists and massage therapists differ again. A registered massage therapist can usually recover some of the HST on the business share of those vehicle costs, on top of the deduction. A physiotherapist is HST-exempt, so there is no HST to claim back, just the deduction itself. Either way the deduction is yours, and we make sure the HST side is handled correctly for those who are registered.
Keep it simple
Log your trips, hang on to your fuel and repair receipts, and let the percentage do the work. Our free tracker gives you a place to keep the totals, and you can see the rest of what you are entitled to in our deduction guides for physiotherapists and massage therapists.
Frequently asked
Yes, the business share of it. Track your business kilometres against your total kilometres for the year, and apply that percentage to your fuel, insurance, maintenance, and other vehicle costs.
No. Driving from home to your one regular workplace is personal. Driving between work locations, out to clients, or for supplies is business. If your home is your main place of business, trips from there to other locations can count.
Yes. Your claim is based on your business-use percentage, and without a record of your kilometres it is hard to support. A phone app that logs trips automatically makes it painless.
A registered massage therapist can usually recover some HST on the business share of vehicle costs, on top of the deduction. Physiotherapists are HST-exempt, so they take the deduction but cannot claim HST back.
This article is general information for Canadian health practitioners, not advice for your specific situation. Vehicle deductions depend on your records and circumstances, so confirm with an accountant before you file.