14 March 1995 External T.I. 9428915 - WHETHER TRAVEL PERSONAL OR BUSINESS

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the Department.

Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.

Principal Issues:

four scenarios -each considers whether travel in employer provided vehicle is considered employment related for purposes of 6(1)(e) and (k)

Position TAKEN:

The Department's long standing position that travel between the home and workplace is personal in nature is not altered by the fact that an employer may require an employee to perform an employment-related function during the course of the trip between the home and workplace. If the primary purpose of a particular trip is personal then it is treated as such regardless of any employment activity which may take place during the course of that trip

Reasons FOR POSITION TAKEN:

consistent with comments in IT-63R4 and previous opinions

								942891
XXXXXXXXXX							Sandra Short

Attention: XXXXXXXXXX

March 14, 1995

Dear Sirs:

Re: Employer-provided vehicles - whether travel personal or business

This is in reply to your letter of November 8, 1994 which requests the Department's opinion in four different scenarios concerning travel between an employee's home and work. Each scenario questions whether travel is employment related for purposes of calculating the standby charge and operating cost benefit in accordance with paragraphs 6(1)(e) and 6(1)(k) of the Income Tax Act. You have asked that we consider the following situations where each municipally-employed individual is on call 24 hours per day and each is provided with an employer-owned vehicle:

1.A is a By-Law Enforcement Officer who is provided with a customized employer-owned truck which is suitable for carrying stray dogs. Each day, A starts with a patrol of the area for which s/he is responsible. Several times per week A is required to make deliveries at the end of the day. S/he would normally make the deliveries and then travel home. A is frequently required to drop cheques off at the end of the day and pick them up again in the morning on the way to work. The police often leave stray dogs in the By-Law Officer's truck at night to protect them. A must deal with the dog as soon as s/he begins work the next day. Your specific questions relating to this situation are:

i)is A's trip to work each day employment related considering the fact that s/he performs duties each day on the way to work;

ii)if A delivers goods or drops off cheques on the way home, is the entire trip home employment related and if not, is a portion considered employment related and

iii)is A's trip to work employment related if s/he is delivering a stray dog on the way to work?

2.B is a Roads Foreman. November through April each year, the foreman is required to patrol the roads at night. The foreman also responds to emergency calls and meets with municipal residents after hours. In the winter months, the foreman patrols the roads in the morning before going to the employer's yard and takes the same route at night patrolling the roads before going home. In the remaining months, various projects are often visited such as asphalt paving, surface treatment and construction or maintenance projects before arriving at the employer's yard in the morning and on the way home in the evening.

i)In the winter months when B is patrolling the roads on the way to and from work, is the trip personal use of the employer's vehicle? Would B's trip be considered employment related if a project site is investigated on the way?

3.C is required to use the vehicle from home if called to an emergency and is also required to attend meetings in the evenings. If C is required to attend an employment related meeting in the evening it is your understanding that travel to the meeting is employment related. You have asked whether the fact that the employee is required to attend meetings at night and therefore requiring the use of the employer-provided vehicle alter what would usually be considered personal travel to and from work.

4.D responds to trouble call-outs from home such as water system failures, road condition situations, By-Law enforcement and staff support call-outs during vacation and illness. D also supports the road patrol in the winter and attends various council and administrative meetings in the evenings. Occasionally these duties required specific route deviations from that which would normally be taken on the way to and from work. If D responds to a call and then proceeds to the usual workplace, is the entire trip from home to work considered employment related?

Our Comments

Paragraph 5 of Interpretation Bulletin IT-63R4 states that personal use of an employer-provided vehicle includes travel between the employee's place of work and home, even though the employee may have to return to work after regular duty hours. An exception occurs where, as required by the employer or with the employer's permission, the employee proceeds directly from home to a point of call other than the employer's place of business to which the employee reports regularly or returns home from such a point. We respond to your questions in the order presented:

1.The Department's long standing position that travel between the home and workplace is personal in nature is not altered by the fact that an employer may require an employee to perform an employment-related function (such as an area patrol or a delivery or pick-up) during the course of the trip between the home and workplace. Where the primary purpose of a particular trip is personal in nature, then it is treated as such for tax purposes regardless of any employment activity which may take place during the course of that trip. The primary purpose of any such trip is always a question of fact.

2.The comments in 1. above continue to apply. Where the primary purpose of the trip is to transport the employee from home to the workplace or vice versa then the fact that the conditions of the various roads must be inspected or patrolled while en route does not alter the primary purpose. Where the employee is directed or permitted to travel from home to a point of call other than the employer's place of business to which the employee regularly reports, that distance is considered employment-related.

3.C's travel from the regular place of employment to home and again from home to work in the evening is personal travel as reflected in paragraph 5 of Interpretation Bulletin IT-63R4. If the evening emergency requires C to travel from home to a point of call other than the employer's place of business to which C reports regularly, the trip will be employment related as will the return trip home from such a point.

4.As stated above, the primary purpose of any trip is always a question of fact. Where D responds to a call-out from home (that is, to a destination other than the employer's place of business to which D reports regularly), the purpose of that particular trip is employment related in accordance with the comments found in paragraph 5 of Interpretation Bulletin IT-63R4. Where D subsequently proceeds from the point-of-call destination and returns home, that travel is also considered employment related. On the other hand, where the primary purpose of D's travel is to commute from home to the workplace then an employment related deviation while en route to the workplace will not alter the primary purpose of that trip. Travel to council and administrative meetings which cause D to return to the workplace in the evening is personal.

We trust our comments will be of assistance to you.

Yours truly,

P.D. Fuoco
for Director
Business and General Division
Rulings Directorate
Policy and Legislation Branch