If you own a business or an employee who needs a car for work, you should know if it is more tax efficient to buy or lease a car in Canada.
There are several steps to answering the question: "Is it better to rent or buy a car for a business in Canada?"
Watch this video to learn more.
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Table of Contents
00:39 – Buying a car – Step # 1: Calculating the cost of the car + fees and HST
01:08 – Buy a car – Step # 2: Calculate the maximum amount for CCA
02:00 – Buying a car – Step # 3: Calculating total CCA
03:48 – Buying a Car – Step # 4: Calculating Tax Savings
05:45 – Buying a car – Step # 5: Calculating the after-tax value of car
07:10 – Leasing a car – Step # 1: Calculating the total cost of leasing during the lease term
08:17 – Leasing a car – Step # 2: Calculating the tax savings of lease payments
09:06 – Rent a car – Step # 3: Calculate after tax Cost of leasing
09:33 – Direct comparison: Buy vs. Leasing
10:43 – Take into account: hidden costs for leasing
11:30 – Take into account: Pride of property
11:40 – Take into account: Cash flow
11:58 – Take into account: Interest Rate
About the Author – Allan Madan – Accountant Mississauga, Oakville, Toronto
Allan Madan is a Certified Public Accountant in the Mississauga, Oakville and Toronto regions of Ontario, Canada. Provides tax planning, accounting and tax preparation services for its clients.
The information provided in this video is intended to provide general information. The information does not take into account your personal situation and is not intended to be used without the consultation of accounting and financial professionals. Allan Madan and Madan Chartered Accountant will not be responsible for any problems arising from using the information provided in this video.
Video credits to Allan Madan YouTube channel