Vehicle Cost Calculator

Capital Cost Allowance (CCA) is Canada's tax depreciation system. When you buy or finance, you deduct a percentage of the vehicle's undepreciated cost each year. Most vehicles fall into Class 10 (30% declining balance) with no cost cap, or Class 10.1 if the vehicle exceeds the prescribed limit (~$37,000), which caps the depreciable amount. The half-year rule limits your first-year claim to 50% of the normal rate. Some businesses may qualify for immediate expensing — confirm with your accountant.

Yes, but CRA limits apply. For passenger vehicles above the prescribed amount (~$37,000 + taxes), only a proportional portion of the payment is deductible. For 100% business use, the full (capped) amount is deductible; mixed-use is prorated. Zero-emission vehicles have higher limits. Check current CRA rates annually.

No — this is a nominal cashflow comparison. A dollar spent today is treated the same as one spent in year 7. Deferred payments are worth less in present-value terms, which slightly favours leasing and financing over a cash purchase. For a rigorous analysis, apply a discounted cashflow (DCF) model using your cost of capital as the discount rate.

This calculator uses Canadian mortgage-style compounding. The annual rate is converted to an effective periodic rate:
Rate = (1 + Annual / Compounding)^(Compounding / Payments) − 1
Then the standard annuity formula calculates the payment. Set "Compounding Periods" to match your lender — 26 bi-weekly is typical for Canadian auto loans.

The single most important variable. Holding 8–10+ years almost always makes buying the cheapest option once payments stop. If your business needs change every 2–4 years, leasing offers flexibility to upgrade without the friction of selling.

Leases typically cap at 20,000–24,000 km/year. Excess charges run $0.10–$0.25/km. High-mileage operations — trades, service routes, rural businesses — often find overages make leasing far more expensive than the payment suggests. If you're consistently over the cap, buying or financing is almost always more economical.

Your insurer pays actual cash value (ACV), which may be less than remaining lease obligations. The shortfall is your responsibility unless you carry GAP insurance — verify whether your lease includes it. Early termination fees can also be substantial; know your exposure before signing.

Under IFRS 16 and ASPE, most leases are now finance (capital) leases on the balance sheet — recorded as a right-of-use asset and lease liability. This affects debt ratios and may trigger loan covenants. True off-balance-sheet treatment is now limited to leases under 12 months or low-value assets. Discuss classification with your accountant before signing.

Buy/Finance: you own the depreciation risk — if resale value disappoints, the loss is yours (but upside is yours too). Lease: residual risk sits with the lessor at a price locked in at signing. If the vehicle is worth less at term end, that's their problem. If it's worth more, you can buy it out at a discount.

Leases typically prohibit permanent modifications. Vinyl wraps are usually fine, but service bodies, shelving, toolboxes, or utility beds may violate terms. If your vehicles need significant upfitting, buying or financing is the right choice — removal costs or penalties at lease return can be substantial.

A growing business often values capital preservation over minimizing total cost. If that $80,000 deployed elsewhere earns a 30–40% return, tying it up in a vehicle may not make sense even if buying is nominally cheapest. The contribution margin field in this calculator helps quantify the revenue your fleet needs to generate — use it to frame the conversation.