2024 Per Diem Tax Rules for Canadian Long-Haul Truck Drivers

 

2024 Per Diem Tax Rules for Canadian Long-Haul Truck Drivers

If you're a long-haul truck driver in Canada, understanding the 2024 per diem tax rules is critical for maximizing your tax deductions. The per diem allowance is a daily rate that truck drivers can claim to cover meal and incidental expenses incurred while on the road for work. These tax rules are an essential part of ensuring you keep more money in your pocket while complying with CRA regulations.

What is the Per Diem Allowance?

In 2024, the Canadian Revenue Agency (CRA) allows truckers to claim a flat rate per day for meals and incidental expenses when they are away from their regular work location for at least 12 consecutive hours. For long-haul truckers, this is especially relevant since you're frequently on the road for extended periods. The maximum meal allowance for 2024 is $23 per meal, with up to three meals per day, totaling $69 per day.

Claiming the Per Diem Deduction

The per diem deduction is a great way to lower your taxable income without needing to track every receipt for meals and small expenses. If you're claiming the full amount, you can deduct $69 per day spent on the road. To be eligible:

• You must travel more than 160 kilometers from your home terminal.
• You need to be away for at least 12 consecutive hours.
• The trip must be work-related.

Example Calculation

Let’s say you are on the road for 200 days in a year:

• Daily allowable per diem = $69
• Number of days = 200
• Total deduction = 200 x $69 = $13,800

This $13,800 deduction can significantly reduce your taxable income, translating into substantial tax savings, especially if you combine it with other deductions such as fuel, maintenance, and capital cost allowance.

Recordkeeping Requirements

While the per diem rate eliminates the need to track every meal receipt, you still need to maintain basic records:

• Logbooks: These are mandatory for proving the duration and distance of your trips.
• Travel records: Keep notes about the nature of the trip, starting and ending locations, and how long you were away from your home base.

Accurate recordkeeping will not only help you substantiate your per diem claims but also assist in case of a tax audit. For detailed recordkeeping assistance, consider our bookkeeping services specifically designed for truckers.

How the Per Diem Interacts with HST/GST

The per diem allowance also affects your GST/HST returns. If you're a self-employed trucker or own an incorporated trucking business, you can claim a portion of the GST/HST paid on meals as input tax credits (ITCs). Some accountants use the following:

1. Claim per diem meals up to $69 per day.
2. Deduct 50% of the allowable amount.
3. Claim the GST/HST portion back on your GST return.

This system allows you to reduce your GST/HST liability, which is especially helpful for corporate truck drivers.

 However, We suggest claiming 50% of actual meals for GST (ITC)s.

Additional Expenses Covered by the Per Diem

Besides meals, the per diem covers incidental expenses such as:

• Laundry
• Tips
• Phone calls

These small expenses can add up quickly during a long trip, and the per diem simplifies the process of claiming them without needing a pile of receipts.

Difference Between Per Diem and Actual Meal Expenses

Truckers have two options for meal deductions:

1. Per Diem: The flat-rate deduction we discussed above.
2. Actual Expenses: You can also claim actual meal expenses, but this requires keeping receipts for every meal and deducting 50% of the actual costs.

The choice between per diem and actual expenses depends on which provides the greater deduction. In most cases, the per diem rate is easier and more favorable, especially for long-haul truckers on extended trips.

2024 Changes to Per Diem Tax Rules

In 2024, there are a few updates truck drivers should be aware of:

• Increased Per Diem Rate: The CRA has adjusted the per diem rate from $66 to $69 per day to reflect inflation.
• Eligibility Clarifications: Only truckers who spend over 12 hours away from their home terminal qualify.
• Simplified GST/HST Claims: Truckers can now use simplified reporting methods for claiming GST/HST input tax credits on meals.

For more information on changes to GST reporting, visit our Sales Tax Filing page.

Example Scenarios

Scenario	Per Diem Claimed	Actual Expenses
3-day trip (200 km away)	$69 x 3 = $207	$60 + $45 + $50 = $155
7-day trip (500 km away)	$69 x 7 = $483	$70 + $80 + $75 + $65 = $290
10-day trip (across provinces)	$69 x 10 = $690	$55 + $60 + $50 = $165

As you can see from the examples, the per diem rate often yields higher deductions, especially on long trips.

What Happens if You're Audited?

Truckers are subject to regular tax audits, and meal expenses are often closely scrutinized. If the CRA requests documentation to verify your claims, having proper records will make all the difference. Logbooks, travel itineraries, and trip receipts are crucial.

At Truckeraccountant.ca, we specialize in preparing your books and records for any potential CRA audit. By staying compliant and maintaining accurate records, you’ll avoid fines and penalties.

Maximizing Your Deductions with Truckeraccountant.ca

Understanding the per diem tax rules is just one part of the puzzle when it comes to tax planning for truckers. By partnering with Truckeraccountant.ca, you can maximize your deductions, streamline your GST filings, and keep accurate financial records year-round.

Whether you're interested in mileage deductions, meal allowances, or other specialized services, we’ve got you covered. Contact us today to learn how we can help you make the most of your deductions and reduce your tax liability.

Why Choose Truckeraccountant.ca?

At Truckeraccountant.ca, we understand the unique financial and tax challenges faced by truck drivers. We specialize in serving the trucking industry, ensuring that you receive expert guidance on:

• Per Diem Rules
• GST/HST Filing
• Income Splitting for Incorporated Drivers
• Business Planning

If you're a long-haul truck driver, now is the time to get your tax strategy in place for 2024. Get in touch with us and take advantage of our comprehensive services.

By working with Truckeraccountant.ca, you can focus on what you do best—delivering profitable loads—while we handle your financial planning. Contact us today to maximize your per diem deductions and ensure you're getting the most out of your tax return.