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Ms
Ms. Robin Nestor is provided with an automobile that is owned by her employer. The employer purchased the car in 2018 for $54,000, plus $7,020 in HST. During 2009, she drives the car a total of 72,000 kilometers, of which 67,000 kilometers were employment related. The automobile was used by Ms. Nestor for 268 days during 2019. Calculate Ms. Nestor's minimum taxable benefit for the use of the automobile.
Expert Solution
WORKINGS
Standby Charge [(2%)(9)($54,000 + $7,020)(5,000/15,003*)] $3,660
Operating Cost Benefit - Lesser Of:
[($0.26)(5,000)] = $1,300
[(1/2)($3,660)] = $1,830 $1300
Minimum taxable benefit =$4960
Notes
1. 268 days= 268/30= 8.9 rounded to the nearest whole number=9 months of availability.
2. Further, Ms. Nestor's employment use (67000/72000=93.06%) is over 50%, entitling her to a reduction in the full standby charge.
3. Although she can use the alternative one-half of the standby charge calculation of the operating cost benefit, Ms. Nestor would not do so since it results in a higher benefit.
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