Assignment Problem Three - 5 (Taxable Automobile Benefits)

It is the policy of Caplan Ltd. to provide automobiles to four of their senior executives. The cars

may be used for both employment-related activities as well as personal travel. When it is not being used by the employee, the company requires the cars to be returned to the companys garage.

For 2020, the details regarding the use of these cars is as follows:

Ms. Bambi Caplan Bambi is provided with a BMW 300 Series, which the company leases for $650 per month. This amount includes $110 per month for insurance. She drives a total of 57,000 kilometres of which only 21,000 is employment related. Operating costs, all of which were paid by the company, total $11,300. Because of her extensive personal use of the vehicle, Bambi pays the company $200 per month.

Mr. Jerome Caplan Jeromes car is an Audi A5 purchased by the company for $74,200. During the 10 months that the car was available to John during the current year, he drove a total of 93,000 kilometres, of which 24,000 involved personal travel. Operating costs, all of which were paid by the company, total $19,400.

Required: Calculate the minimum taxable benefit that will accrue to each of these executives as the result of having the cars supplied by the company. Ignore all GST/PST/HST implications.