ABC provides a company car to its employees. ABC had two choices, purchase the vehicle at $25,000 (ignore HST), or lease the vehicle at $550 per month (ignore HST) for four years. Irene is an employee at ABC. In 2021, Irene will drive the company vehicle for a total of 17,600 km. Irene is expecting that 5,000 of those kilometers will be personal. ABC will pay the operating costs on the vehicle of $3,500. ABC will have the vehicle available for Irene as of March 1, 2021. 

Required: 

Calculate the minimum taxable benefit. This includes the standby charge and the operating cost.

Scenario 1: the vehicle is purchased by ABC 

Scenario 2: the vehicle is leased by ABC

 

Answer rating: 100% (QA)

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