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Gondaliya CPA

Corporate Tax Filing Experts

Tax Accountant for Taxi Businesses in Ontario and Across Canada

We register you for GST/HST from your very first fare — mandatory for a taxi operator no matter how small, because the $30,000 small-supplier exemption does not apply — charge 13% HST on every metered and flat fare, and recover the fuel, maintenance and insurance input tax credits the Quick Method makes even easier to bank. We put your cars in CCA Class 16 at 40% where a taxicab is specifically named rather than the slower Class 10, capitalize your municipal taxi plate as a Class 14.1 intangible asset, and account for plate-leasing and driver-lease income the way CRA expects. Whether you are an owner-driver, a multi-car operator or a plate-owning fleet, we handle the fare and cash-fare bookkeeping, the driver payroll and owner-operator classification, and the incorporation and tax planning on your business — with AFFORDABLE flat fees.

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AFFORDABLE Taxi Business Tax Accountant

A taxi business runs on two rules that set it apart from every other small business. First, HST is mandatory from your very first dollar: a taxi, limousine or commercial ride-share operator must register for GST/HST regardless of the $30,000 small-supplier threshold, so every fare carries 13% HST and, in return, every litre of fuel, every repair and every insurance premium carries a recoverable input tax credit. Second, the car and the plate get special treatment — a taxicab is specifically named in CCA Class 16 at 40%, a faster write-off than the ordinary Class 10, while your municipal taxi plate is a valuable Class 14.1 intangible that can also earn plate-leasing income. That is why you need a CPA who knows the trade. At Gondaliya CPA, we specialize in fare, fuel and plate accounting and corporate tax planning for cab operators, providing AFFORDABLE flat-fee support that keeps you CRA-compliant and stops you paying more tax than you owe.

As a taxi and limousine business accountant, we work with owner-drivers, multi-car operators, plate owners who lease cars to drivers, and airport and dispatch-brokered fleets across Ontario, with year-round support rather than a once-a-year scramble. We tell you plainly what you can deduct, what you cannot, and where the real margin sits on each car, plate and driver.

Let us handle the numbers so you can focus on the work that actually pays you.

Gondaliya CPA team - accounting and tax services for taxi businesses

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Accounting That Understands How a Taxi Business Actually Works

Running a taxi business comes with tax rules a desk-bound business never faces. HST is mandatory from your first fare with no small-supplier exemption, your cars belong in the faster Class 16 rather than the ordinary Class 10, your municipal plate is a capital asset that can also earn lease income, and your fares are heavily cash so CRA watches your reporting closely. At Gondaliya CPA, we understand the financial reality of a cab operator and provide practical, taxi-focused solutions across the GTA and all of Ontario.

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Mandatory HST & ITCs

You must register for GST/HST from the first fare with no $30,000 exemption, and fuel, maintenance and insurance all carry input tax credits.

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Class 16 Cars & the Plate

A taxicab is named in Class 16 at 40%, faster than Class 10, and your municipal plate is a Class 14.1 intangible worth capitalizing.

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Plate & Driver-Lease Income

A plate you lease out earns income, and fleet owners who lease cars to drivers book lease revenue while the drivers run their own fares.

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Cash Fares & Driver Status

Cash-fare reporting is a top CRA audit focus, and each driver is either an owner-operator on a T4A or an employee on a T4 with WSIB.

Stay Compliant and Minimize Your Taxi Business Tax

For a taxi business, staying onside with CRA and paying the least legal tax are the same job. We keep every filing on schedule while claiming every vehicle, fuel and plate dollar the T2 allows, so nothing is missed and nothing invites a reassessment.

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Municipal Licensing & HST Registration

A taxi business needs a municipal owner and driver licence and a vehicle plate before it can carry a fare, and unlike an ordinary small business it must register for GST/HST from the very first dollar because the special ETA rule for taxi operators overrides the $30,000 small-supplier threshold. WSIB coverage applies once you employ drivers rather than lease to owner-operators. Getting the licence, plate and mandatory HST registration right protects the business from reassessment and from back tax on fares you should have taxed.

CRA Obligations for Taxi Businesses

Staying compliant with CRA means more than one return a year. We manage HST at 13% on every metered and flat fare, input tax credits on fuel, maintenance and insurance, the Quick Method election where it remits less, payroll source deductions on the PD7A remittance, and T4A slips for owner-operator drivers. By monitoring the areas CRA reviews most often on cash-intensive taxi files, we reduce your audit exposure and keep your business financially sound.

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Year-End Deliverables for Taxi Businesses

At year-end, an incorporated taxi business needs a proper trial balance and financial statements that carry the vehicle fleet at net book value, the taxi plate as a Class 14.1 intangible, driver-lease and plate-lease income, and meter and equipment, plus a T2 with GIFI on Schedule 125 and Schedule 100 that ties to your HST returns. Where a lender is involved, you also need CPA-compiled financial statements for vehicle or plate financing. Our team prepares every deliverable on time, so your file is audit-ready and financing-ready.

Accounting & Tax Experts for Taxi Businesses

Gondaliya CPA taxi business accounting expertsGondaliya CPA taxi business tax experts
  • AFFORDABLE + Fully Registered CPA Firm
  • Business and Corporate Tax Expert
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Why Choose Our Accounting Services for Taxi Businesses?

1
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Tax Planning — Vehicle & Plate Expertise

We know the assets: cars in Class 16 at 40% where a taxicab is specifically named, the municipal plate as a Class 14.1 intangible, meter and equipment in Class 8 at 20%, dispatch and booking software in Class 50 at 55%. We capture fuel and insurance credits and protect the $500,000 Small Business Deduction.

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Consulting — Fare, Cash & Lease Bookkeeping

Our bookkeeping is built for cab operators. We reconcile metered, flat and account fares against cash and card, track fuel and maintenance credits, book driver-lease and plate-lease income, and tie your HST returns to the revenue you report on your T2.

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CRA Representation — Cash-Fare & HST Audit

When CRA reviews your cash fares, your fuel input tax credits, or your driver classification, we prepare the response, reconcile your HST, file the Notice of Objection within 90 days, and pursue relief on Form RC4288 where penalties came from a prior error.

4
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Bookkeeping — Incorporation Readiness

We model the exact profit level where incorporating pays for itself, then handle the section 85 rollover on Form T2057 so your cars, plate and goodwill move into the corporation without triggering tax.

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Taxi Business Clients
Includes personal T1 filing for the owners and their family
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Weekend and evening support until 9 PM
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Taxi Business Tax and Accounting Services in Ontario

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Corporate Tax Filing (T2) for Taxi Businesses

Professional T2 preparation with Schedule 8 CCA on your Class 16 cars, plate capitalization, and CRA compliance on every fare line.

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Bookkeeping & Accounting for Taxi Businesses

Fare, cash and lease-income bookkeeping with financial statements, clean records, and monthly reporting built for a cab operator.

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Payroll Services for Taxi Businesses

Driver payroll with WSIB where drivers are employees, PD7A remittances, T4s for employees and T4A slips for owner-operators.

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GST/HST Filing for Taxi Businesses

AFFORDABLE mandatory HST registration and filing at 13% on fares, with Quick Method analysis and full ITCs on fuel and insurance.

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Tax Planning for Taxi Businesses

Smart tax planning to protect the Small Business Deduction, get the Class 16 CCA right, capitalize the plate, and plan salary, dividends and sale.

Corporate Catch-Up Filing for Taxi Businesses

File overdue T2 and HST years, rebuild missing fare, fuel and lease records, and get back into CRA compliance with accurate catch-up support.

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CRA Audit Resolution for Taxi Businesses

Expert support for cash-fare, fuel-credit, driver-status and HST audits, with indirect-verification-of-income reviews handled with confidence.

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CPA Financial Statements (Notice to Reader) for Taxi Businesses

CPA-compiled financial statements that vehicle, plate and equipment lenders and banks accept for your taxi corporation.

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Incorporation Services for Taxi Businesses

Full incorporation including NUANS, articles, share structure, and the section 85 rollover from your unincorporated taxi business.

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Catch-Up Bookkeeping Services for Taxi Businesses

We rebuild months or years of metered, account and cash-fare records into clean books your T2, HST returns and CRA reviews can stand on.

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US Corporation & LLC Tax Filing for Taxi Businesses

Cross-border 1120, 1120-F and Form 5472 filings for taxi operators running US corporations, LLCs or airport routes into the States.

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Voluntary Disclosure Program for Taxi Businesses

Come forward on unreported cash fares through the CRA Voluntary Disclosures Program on Form RC199 before an audit, cutting penalties and interest.

Accounting & Tax Services Tailored for Taxi Businesses

Real, practitioner-level CPA expertise for owner-drivers, multi-car operators, plate owners who lease cars to drivers, and airport and dispatch-brokered fleets across Ontario — built for how a cab business with mandatory HST, Class 16 cars and a valuable plate actually runs.

  • We prepare your T2 with GIFI on Schedule 100 and Schedule 125, reporting metered, flat, account and airport fare revenue on its correct line, so CRA’s automated matching does not flag your taxi business for a desk audit that bills tax you never owed.
  • We claim capital cost allowance on Schedule 8 with your cars in Class 16 at 40%, where a taxicab is specifically named, not the ordinary Class 10; on one fleet, moving the cars from Class 10 to Class 16 accelerated $12,000 of CCA.
  • We capitalize your municipal plate as a Class 14.1 intangible asset rather than expensing the purchase, so its cost is written off at 5% a year and the plate sits on the balance sheet as the valuable capital asset it truly is.
  • We file your T2 within six months of your fiscal year-end and settle the balance within the two or three months CRA allows, so arrears interest never starts running on a taxi corporation it still treats as filed and paid on time.
  • Where you drive a single cab and have not incorporated, we file Form T2125 on your personal T1 instead of a T2, reporting fare income and vehicle costs on the correct lines so an owner-driver return is never overstated to CRA.
  • We sync your taximeter and dispatch records from iCabbi to QuickBooks Online or Xero so every metered, flat and account fare posts to the right account and you keep the six years of records section 230 of the Income Tax Act requires.
  • We reconcile your cash fares to bank deposits every month, because cash-heavy fare income is a top CRA audit focus and a taxi business whose deposits do not match its reported fares is among the fastest files pulled for a costly review.
  • We capture every fuel, maintenance and tire invoice through Dext and reconcile monthly, so the 13% HST input tax credit on each fill-up and repair is never lost to a missing receipt; on one operator we captured $9,100 of fuel and insurance ITCs.
  • We book the lease income you earn from leasing a cab to a driver as your revenue and the driver’s fares as the driver’s own, so your fleet’s lease receipts are reported cleanly and each driver is taxed on the fares they run.
  • We track plate-leasing income separately where you lease your municipal plate to another operator, recognizing it as a distinct revenue stream so the Class 14.1 asset you hold is matched to the income it generates each year.
  • We set up driver payroll in Wagepoint, withholding income tax, CPP and EI and remitting on the PD7A by the 15th of the following month, so a busy taxi office never eats CRA’s 10% late-remittance penalty on source deductions.
  • We test whether each driver is an employee on a T4 or an owner-operator on a T4A using the RC4110 factors of control and ownership of tools, because misclassifying a driver to avoid CPP, EI and WSIB invites a fast payroll reassessment.
  • We register and reconcile WSIB coverage where your drivers are employees rather than owner-operators, filing premiums on assessable wages so an unregistered taxi business does not face retroactive premiums going back two years plus penalties.
  • We prepare T4 slips for employee drivers and T4A slips for owner-operators and file the T4 Summary by the last day of February, reconciling them to the PD7A so year-end slips never trip a CRA earnings review.
  • We build the per-shift, lease and commission pay structures cab drivers actually work into the payroll; on one multi-car operator we corrected $7,300 of unremitted source deductions before CRA found the gap and charged the penalty.
  • Unlike an ordinary small business, a taxi operator must register for GST/HST from the very first fare because the Excise Tax Act names a taxi business specifically and overrides the $30,000 small-supplier threshold, so we register you before CRA assesses uncollected tax.
  • We confirm you charge 13% HST on every metered, flat, account and airport fare and file each return by its deadline, because there is no exempt taxi line and an untaxed fare becomes tax CRA assesses against your business with interest.
  • We file the Form GST74 Quick Method election where it suits your fares, remitting a flat percentage of tax-included revenue instead of 13% less credits; on one owner-driver the Quick Method kept $4,300 of HST a year.
  • We claim the input tax credits your fuel, maintenance, tires and commercial insurance carry, recovering the 13% HST on line 108 of your return, a recovery a taxi operator who wrongly assumes fares are exempt loses entirely every filing period.
  • We match the fare revenue on line 101 of your HST return to the income on your T2 every period, because CRA’s matching program compares the two and a taxi file whose figures disagree is quickly pulled for a costly audit.
  • We set the salary-versus-dividend mix for the owners, paying enough T4 salary to build RRSP room while the balance flows as dividends, so combined tax stays near the 12.2% Ontario small-business rate rather than your 53.53% personal rate.
  • We keep your active fare income under the $500,000 Small Business Deduction limit using section 125, and we watch CRA’s associated-corporation and passive-income rules that grind the limit toward the higher general corporate rate.
  • We time your car purchases before your fiscal year-end so the Class 16 declining-balance rate and the Accelerated Investment Incentive give the largest first-year deduction; on one operator that timing pulled forward $14,600 of capital cost allowance.
  • We plan at least two years ahead so your shares qualify for the $1.25M Lifetime Capital Gains Exemption, purifying the company of idle cash so selling your taxi business, plates included, defers tax CRA would otherwise collect on the gain.
  • We pay a reasonable salary to a spouse who dispatches or keeps the books, supported by timesheets, because section 67 of the Income Tax Act lets CRA deny any amount above what an arm’s length person doing the same work would have been paid.
  • We reconstruct fare revenue from bank deposits, taximeter records and card-processor statements where no bookkeeping exists across your unfiled years, so CRA cannot arbitrarily assess your taxi business on its own estimate and overcharge you.
  • Late filing costs 5% of the balance owing plus 1% per month up to twelve months, so we file your oldest unfiled T2 first to stop the penalty compounding and limit the arrears interest CRA charges your business.
  • We file the missing HST returns and reconcile the 13% you should have charged on fares against what you actually remitted, so tax you collected is accounted for and CRA cannot assess back tax with interest on the gap.
  • We rebuild the undepreciated capital cost pools across the unfiled years so missed CCA on cars in Class 16, the plate in Class 14.1 and equipment in Class 8 is recovered; on one fleet that restored $12,800 of overlooked depreciation.
  • We file a Voluntary Disclosures Program application on Form RC199 before CRA contacts you, because a disclosure accepted under the general program cancels penalties in full and gives 50% interest relief on the older years.
  • When CRA opens an audit, we manage the whole file and answer the fare, fuel-credit and HST queries inside the deadlines, so a review of one year does not expand into a reassessment of three prior years and more tax.
  • When CRA runs indirect verification of income on a cash-heavy taxi business, comparing bank deposits and lifestyle to reported fare revenue, we prepare the source-and-application-of-funds reconciliation within the 30-day deadline before CRA assesses the gap.
  • We defend your cash-fare reporting with a per-shift log tied to meter readings and deposits, because cash fares are the single item CRA scrutinizes hardest on a taxi file and undocumented cash is what turns a review into a reassessment.
  • We answer fuel input tax credit and Class 16 depreciation reviews with logbooks, fuel receipts and supplier invoices, because a credit or a CCA claim disallowed for missing records cannot be restored later at the objection stage.
  • We file the Notice of Objection within 90 days of a reassessment and pursue taxpayer relief on Form RC4288 where a prior accountant’s error caused the penalties; on one file we had $6,500 of penalties and interest cancelled.
  • We prepare the CSRS 4200 compilation engagement financial statements, the Notice to Reader a vehicle or plate lender and a bank require across two fiscal years; on one operator our compiled statements unlocked $140,000 of financing for three new cars.
  • Your compiled statement of financial position presents the taxi fleet at net book value, the municipal plate as a Class 14.1 intangible, and lease receivables, giving a lender the working-capital picture a bare T2 cannot, so financing is approved faster.
  • We build the statement of operations with metered, account and lease revenue and fuel and driver cost classified consistently across two fiscal years and tied to the T2 filed with CRA, so a lender approves the line rather than declining on reclassified noise.
  • The CSRS 4200 communication discloses that no audit or review was performed, and without it a bank and the Business Development Bank of Canada reject the file and the operating credit you need to carry fuel and insurance between fare settlements.
  • We deliver the compiled statements within 30 days of receiving your records and the year’s T2 figures, because a taxi business’s vehicle or plate financing approval collapses when the lender’s conditional offer expires before the file is produced.
  • We incorporate your business under the Ontario Business Corporations Act, giving you limited liability and the roughly 12.2% Ontario small-business rate against the passenger-injury and collision exposure an unincorporated owner-driver never sheltered you from.
  • We complete the section 85 rollover on Form T2057, transferring your cars, your municipal taxi plate and goodwill into the corporation at elected amounts, deferring the capital gain and recapture a straight sale would trigger; on one plate owner that deferred $22,000 of tax.
  • We open the corporation’s CRA Business Number, GST/HST and payroll accounts within the first 30 days and register for HST immediately, because a taxi operator has no small-supplier grace period, then close the old accounts so revenue is never reported twice.
  • We coordinate the transfer of your municipal owner and driver licences and vehicle plate into the corporation’s name, because a plate registered to the individual rather than the company leaves the corporation without the asset it needs to carry a fare.
  • We structure the share classes and set the first fiscal year-end up to 53 weeks after incorporation, so dividends can later be split among family shareholders and the first T2 and CRA balance-due date are deferred to save the business cash.
  • We reconstruct months or years of metered, dispatch-account and cash-fare income from trip sheets, meter logs and bank deposits, rebuilding the revenue figure CRA scrutinises most closely in the cash-heavy taxi trade.
  • We catch up your input tax credits on fuel, insurance, repairs and the municipal plate, then file the outstanding HST returns, because a taxi operator collects HST on every fare with no small-supplier exemption to hide behind.
  • We rebuild the capital cost allowance schedule for each vehicle, tracking additions, dispositions and the half-year rule, so the depreciation carried into your T2 reflects the actual fleet rather than the guesswork a lapsed set of books invites.
  • We separate genuine driver wages and lease payments from owner draws in the back records, because misclassified payments to drivers are the first thing a CRA reviewer challenges when a taxi file with unreconciled cash finally surfaces.
  • We deliver reconciled year-end books ready for the overdue T2 and personal returns within 45 days of receiving your shoebox, so mounting late-filing penalties and arrears interest on unreported fare income stop compounding against your corporation.
  • We prepare the US Form 1120 for taxi operators who set up a US C-corporation to run cross-border airport and charter routes, reconciling the American return with the Canadian T2 so the same fare income is never taxed twice.
  • We file Form 1120-F where your Canadian taxi corporation earns US-source fares through a permanent establishment across the border, claiming treaty protection under the Canada-US treaty so only genuinely US income falls into the American net.
  • We complete Form 5472 to report the reportable transactions between your Canadian owner and the US entity, because a missed 5472 carries a US$25,000 penalty that dwarfs the tax on a handful of cross-border taxi trips.
  • We untangle the LLC that many drivers form south of the border, since the CRA treats it as a corporation while the IRS treats it as flow-through, a mismatch that strands your US fare income in double tax without careful structuring.
  • We claim the foreign tax credit on your Canadian return for the US tax your taxi operation actually pays, so the American filing offsets rather than adds to your Canadian liability and no cross-border fare dollar is taxed in both countries.
  • We file your application to the CRA Voluntary Disclosures Program on Form RC199, coming forward on the cash fares that never reached your books before an auditor’s indirect-income review reaches them first and closes the door.
  • We quantify the unreported metered and cash fare income across each open year and rebuild the missing HST that should have been collected on it, presenting the CRA a complete package that qualifies your taxi disclosure as valid.
  • We secure the penalty relief and partial interest relief the program offers, which on one owner-driver’s three years of undeclared fares removed roughly $18,000 of gross-negligence penalties that a CRA audit would otherwise have imposed.
  • We correct the overstated vehicle CCA and personal-use fuel and repair claims that often accompany the unreported income, so the disclosure fixes both sides of the ledger and no fresh reassessment follows the one you volunteered.
  • We make the disclosure before CRA enforcement begins, because once a demand letter, audit or plate-record data match lands, your taxi business loses eligibility and faces the full penalties plus possible prosecution the program was designed to avoid.

Taxi Business Tax & HST Check

Six quick questions on your mandatory HST registration, the Quick Method, your Class 16 cars, the taxi plate, driver status and whether it is time to incorporate. No fee shown.

1. Are you registered for GST/HST and charging 13% on every fare?

2. Are you using the Quick Method for your HST remittance?

3. Are your cars claimed in CCA Class 16 at 40% rather than Class 10?

4. Is your municipal taxi plate capitalized as an asset on the books?

5. Are your drivers correctly classified as T4 employees or T4A owner-operators?

6. Is your taxi business incorporated yet?

Free CPA Consultation for Taxi Businesses

Case Studies: Taxi Business Accounting & Tax

Toronto Taxi Fleet Operator — Class 16 Cars & Plate Assets

The problem: A Toronto taxi fleet operator running eight cars had the whole fleet depreciated as ordinary Class 10 at 30% instead of the Class 16 rate a taxicab qualifies for, so it was badly under-claimed each year. The cost of two municipal taxi plates had been expensed and never capitalized, and fuel, maintenance and insurance input tax credits were missed because receipts were never captured.

What we did: We reclassified the cars into Class 16 at 40%, capitalized the two plates as Class 14.1 intangibles, set up Dext so every fuel and repair credit flowed through, and reconciled the HST returns to the T2.

The result:

  • Accelerated $12,000 of CCA by moving cars to Class 16
  • Captured $9,100 of fuel and insurance ITCs a year
  • Plates capitalized and HST reconciled to the T2

Mississauga Owner-Driver — Mandatory HST & Recovered ITCs

The problem: A Mississauga owner-driver had never registered for GST/HST, wrongly assuming the $30,000 small-supplier threshold applied to a taxi, so several years of fares had gone out untaxed and CRA now wanted the back HST. The same years of fuel, maintenance and insurance input tax credits had also been lost, and no logbook supported the vehicle costs claimed on the T2125.

What we did: We registered the operator for HST, which is mandatory for a taxi from the first fare, filed the outstanding returns, elected the Quick Method so the remittance dropped, and recovered years of fuel and insurance ITCs against the back tax while rebuilding the mileage logbook.

The result:

  • Quick Method kept $4,300 of HST a year
  • Recovered ITCs offset most of the back tax owing
  • T2125 vehicle claim fully supported for CRA

Ottawa Multi-Car Taxi Business — Lease Income & Driver Status

The problem: An Ottawa multi-car taxi business leased four cars to drivers but tracked neither the lease income it collected nor the cash fares flowing through, and it was unclear whether the drivers were employees or owner-operators, exposing the company to a payroll reassessment for unremitted CPP, EI and WSIB. The books were a spreadsheet that never tied to the bank.

What we did: We built driver-lease and fare bookkeeping in QuickBooks Online, reconciled cash fares to deposits each month, and applied the RC4110 factors to confirm each driver’s status, setting up T4A slips for the genuine owner-operators and payroll for the employees.

The result:

  • Driver status clarified and documented
  • Lease and fare income now tied to the bank
  • Books audit-ready for a CRA review

Our Simple Process

How We Work With Taxi Businesses

Know Exact Fees within 2 Minutes NOW

Our clear, efficient process ensures every step is transparent, building trust and long-term client relationships.

Here’s a simplified process approach:
Step 1

Kickoff (Document Request)

Collect prior T2 or T2125 returns, HST filings, vehicle and plate list, fuel and maintenance records, taximeter and dispatch logs, driver-lease and payroll details, municipal licences, and bank statements.

Step 2

First 30 Days (Cleanup & Setup)

Confirm mandatory HST registration and the Quick Method, set up QuickBooks Online or Xero, integrate iCabbi or your booking app, build Class 16 and plate CCA schedules, and configure driver payroll.

Step 3

Monthly Close

Monthly reconciliations, cash-fare and card matching, fuel and receipt capture, HST on fares, and driver-lease and plate-lease income tracking.

Step 4

Quarterly Planning Review

Salary and dividend mix, Class 16 and car-purchase timing, Quick Method and fuel-credit review, and the incorporation break-even check.

Step 5

Year-End Close & T2 Filing

Trial balance, financial statements with the fleet, plate and lease income, T2 with GIFI, and CRA preparation.

Get Your Taxi Business Taxes Done Right Today

Transparent Pricing for Taxi Businesses

Affordable Pricing for Taxi Businesses

Know Exact Fees within 2 Minutes NOW

We believe in clear, upfront pricing so you know exactly what to expect. All fees include HST.

  • Tax Preparation (Taxi Business, T2) — From $400
  • Tax Return Filing (T2 corporate return) — From $400
  • Tax Compliance Audit — FREE CRA audit support for our clients
  • Tax Strategy — FREE for our clients
  • Accounting Base Plan — From $100 per month
  • Bookkeeping Management — Free for our Accounting clients
  • Financial Reporting — Free for our Accounting clients
  • Business Formation — Flat $35
  • Incorporation Process — Flat $35
  • Entity Setup Assistance — Flat $35
  • Full-Service Payroll — From $125 per month

Payment is by Interac e-Transfer to info@gondaliyacpa.ca only. Security question: Not Applicable, as auto-deposit is enabled.

Meet Your Lead Taxi Business Accountant

Meet your lead taxi business accountant. As your vehicle, plate and corporate tax adviser, you deal with the same two people every year.

Sharad Gondaliya CPA

Sharad Gondaliya, CPA

Principal

Bio

647-212-9559
sharad@gondaliyacpa.ca

Vandana Goel CPA

Vandana Goel, CPA

Accounting Specialist

Bio

647-250-0242
vandana@gondaliyacpa.ca

What Our Clients Say

1300+ five-star reviews from taxi, limousine and cab-fleet owners across Ontario and Canada.

Serving Taxi Businesses Across Ontario

Our CPA team provides specialized accounting and tax solutions for taxi, limousine and cab-fleet operators throughout Ontario. We understand how a cab business actually runs, what CRA looks at on a cash-intensive file, and how to get mandatory HST, Class 16 cars and the taxi plate right.

Toronto (ON)

55 Queen St E Ste 1205, Toronto, ON M5C 1R6, Canada

+1 (647) 212-9559

9:00 AM – 8:30 PM (Mon – Sun)

Mississauga (ON)

5373 Bullrush Dr, Mississauga, ON, Canada

+1 (647) 212-9559

9:00 AM – 8:30 PM (Mon – Sun)

Brampton (ON)

4 Starhill Crescent, Brampton, ON L6R 2P9, Canada

+1 (647) 212-9559

9:00 AM – 8:30 PM (Mon – Sun)

Scarborough (ON)

24 Clementine Square, Scarborough, ON M1G 2V7, Canada

+1 (647) 212-9559

9:00 AM – 8:30 PM (Mon – Sun)

Vaughan (ON)

19 Cabinet Crescent, Woodbridge, ON L4L 6H9, Canada

+1 (647) 212-9559

9:00 AM – 8:30 PM (Mon – Sun)

Oshawa (ON)

210 Durham St, Oshawa, ON L1J 5R3, Canada

+1 (647) 212-9559

9:00 AM – 8:30 PM (Mon – Sun)

Ottawa (ON)

2090 Neepawa Ave a314, Ottawa, ON K2A 3L6, Canada

+1 (647) 212-9559

9:00 AM – 8:30 PM (Mon – Sun)

Etobicoke (ON)

60 Stevenson Rd #1601, Etobicoke, ON M9V 2B4, Canada

+1 (647) 212-9559

9:00 AM – 8:30 PM (Mon – Sun)

Hamilton (ON)

70 Starling Dr, Hamilton, ON L9A 0C5, Canada

+1 (647) 212-9559

9:00 AM – 8:30 PM (Mon – Sun)

Guelph (ON)

1155 Gordon St, Guelph, ON N1L 1S8, Canada

+1 (647) 212-9559

9:00 AM – 8:30 PM (Mon – Sun)

Windsor (ON)

4387 Guppy Ct, Windsor, ON N9G 2N8, Canada

+1 (647) 212-9559

9:00 AM – 8:30 PM (Mon – Sun)

North York (ON)

150 Graydon Hall Dr #912, North York, ON M3A 3B2, Canada

+1 (647) 212-9559

9:00 AM – 8:30 PM (Mon – Sun)

Taxi Business Accounting & Tax FAQs

Do I have to register for HST as a taxi business?
Yes, from your very first fare. The Excise Tax Act names a taxi business (and, since 2017, commercial ride-share) as a special case that must register for GST/HST regardless of revenue, so the usual $30,000 small-supplier exemption simply does not apply to you. Every ordinary small business gets to stay unregistered until it crosses $30,000, but a cab operator does not — you register before you carry a single paying passenger, charge 13% HST on your fares, and file returns on the schedule CRA assigns. The upside is real: once you are registered you claim input tax credits on the 13% HST you pay for fuel, maintenance, tires and insurance, so a large slice of your operating cost comes back. Operators who assume the exemption applies end up owing years of back HST on fares they never taxed, while also having lost the credits they could have claimed. We register you correctly and set the filing frequency to your revenue.
Should I use the Quick Method for my taxi HST?
Often, yes. The Quick Method lets you remit a flat percentage of your tax-included fare revenue instead of tracking 13% collected less every input tax credit, and for a service business like a taxi with modest taxable purchases it frequently leaves more HST in your pocket, plus a 1% credit on your first $30,000 of eligible supplies each year. We file the Form GST74 election and model it against the regular method for your actual fares before choosing — on one owner-driver the Quick Method kept $4,300 of HST a year.
What CCA class is a taxi vehicle?
A taxicab is specifically named in CCA Class 16, which depreciates at 40% on a declining balance — noticeably faster than the ordinary Class 10 at 30% that most preparers default to for a car. That faster write-off matters because taxi cars are driven hard and turned over quickly. Meter and payment equipment sits in Class 8 at 20%, and dispatch or booking software is Class 50 at 55%. Getting each car into Class 16 on Schedule 8 rather than Class 10 is where a lot of taxi owners leave money on the table, so we review the whole fleet.
How is my taxi plate taxed?
Your municipal taxi plate or licence is an intangible capital asset, not a current expense, so its cost is capitalized into CCA Class 14.1 and written off at 5% a year rather than deducted all at once. Because a plate can hold or grow in value, it also sits on your balance sheet as a real asset that a lender will recognize. When you eventually sell the plate, the difference between the proceeds and its remaining cost is taxed as a gain, and inside a corporation it can qualify for the $1.25M Lifetime Capital Gains Exemption on your shares. We capitalize the plate correctly and plan for its eventual sale.
How do I handle plate-leasing income?
If you own a taxi plate and lease it to another operator rather than driving it yourself, the lease payments you receive are taxable income and we book them as a distinct revenue stream. The plate stays on your books as a Class 14.1 asset generating that income, and the arrangement is reported cleanly so CRA sees the lease revenue matched to the asset. Where you lease out the whole car as well, the vehicle CCA and running costs are set against the lease income too. We keep plate-lease and car-lease income separate from your own fare income so each is taxed properly.
Do I charge HST on every fare?
Yes. Metered fares, flat-rate fares, account and corporate fares and airport runs are all fully taxable at 13% HST in Ontario — there is no exempt line for taxi work, so the tax is built into or added to every fare you collect. Because you must be registered from your first fare, there is never a period where a taxi operator legitimately does not charge it. The corresponding benefit is the input tax credits on your fuel, maintenance and insurance. We set your bookkeeping so the HST on fares is captured and reconciled to your return every period.
Can I claim fuel and insurance input tax credits?
Yes, and they are among your biggest recoveries. Fuel is a major cost, and the 13% HST on every fill-up is claimable as an input tax credit on line 108 of your HST return, along with the tax on maintenance, tires, repairs and your commercial taxi insurance. These credits are exactly why mandatory registration is not all downside — a registered operator recovers the tax on a large share of operating costs, while an operator who wrongly thinks fares are exempt loses every one of them. We capture the receipts through Dext and claim the credits each period.
Are my drivers employees or owner-operators?
It depends on the working relationship, not on what you call it. A driver you schedule, direct and whose car you supply is usually an employee paid on a T4 with income tax, CPP and EI withheld and WSIB coverage, while a genuine owner-operator who leases the car and runs their own fares is a contractor paid on a T4A. Misclassifying an employee as an owner-operator to avoid CPP, EI and WSIB is one of the fastest ways to a payroll reassessment. We apply CRA’s RC4110 control, ownership-of-tools and integration factors and set the payroll up correctly.
How much corporate tax does a taxi business pay in Ontario?
An incorporated taxi business pays roughly 12.2% combined federal-provincial tax on the first $500,000 of active income under the Small Business Deduction in Ontario, with income above that taxed at the general corporate rate. On top of corporate tax you charge 13% HST on fares, remit payroll source deductions on the PD7A where you employ drivers, and claim your fuel and insurance input tax credits. If you are unincorporated, the same profit lands on your personal return at rates up to 53.53% instead, which is why the incorporation break-even matters once your profit exceeds what you draw.
What can my taxi business write off?
Your cars depreciate through CCA in Class 16 at 40% where a taxicab is named, and the plate is capitalized in Class 14.1 at 5%. You also deduct fuel, oil, tires, maintenance and repairs, commercial taxi insurance, municipal licensing and plate fees, dispatch and brokerage fees, driver wages or owner-operator lease payments, cleaning and detailing, credit-card processing, and meter and equipment costs. Because you are HST-registered, you also recover the 13% on most of those purchases as input tax credits. We put each asset in the right class on Schedule 8 so you are not under-claiming.
How does CRA treat cash fares at a taxi business?
Taxi work is cash-heavy, so it sits on CRA’s underground-economy watch list and cash fares are the single item most likely to trigger a review. CRA can run an indirect verification of income, comparing your bank deposits and lifestyle against the fare revenue you reported and assessing the gap plus penalties and interest. The fix is clean books: every shift’s meter readings and cash and card fares captured and reconciled to your bank deposits, so your reported revenue holds up and there is nothing for CRA to assess. We build that reconciliation into your monthly close.
Should I incorporate my taxi business?
Incorporating gives you limited liability against passenger-injury and collision claims, a 12.2% Ontario combined rate on the first $500,000 of active income, and the ability to split income between salary and dividends. As an owner-driver your profit is taxed at your full personal rate, reaching 53.53% in Ontario, whether you draw it or leave it in the business. The decision usually turns on whether you consistently earn more than you need to withdraw, because that surplus is what a corporation lets you defer. Incorporation also opens the $1.25M Lifetime Capital Gains Exemption on a future sale of your shares, plates included, which an unincorporated operation cannot offer. It does bring annual T2 filing and higher compliance cost, so we model the break-even for your actual numbers and, when the answer is yes, handle the incorporation and the section 85 rollover of your cars and plate on Form T2057.
What accounting software works best for a taxi business?
We pair a dispatch and booking system such as iCabbi with QuickBooks Online or Xero for the accounting, and Dext for fuel and receipt capture. The dispatch system and taximeter records run your metered, flat and account fares, and we map them to the general ledger so fare revenue, driver-lease income and fuel post to the right accounts. Wave or Sage also work for a smaller owner-driver. We set it up and maintain it so your mandatory HST, Class 16 CCA and year-end all tie out without a rebuild.

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Taxi Business Accounting & Tax Done Right.

T2 filing, mandatory HST registration and the Quick Method, Class 16 vehicle CCA, taxi plate assets in Class 14.1, fuel and insurance input tax credits, driver-lease and plate-lease income, owner-operator versus employee payroll and the incorporation decision under one roof. AFFORDABLE flat fees, no hourly billing. Licensed CPA Ontario. 1300+ five-star reviews. 30-Day Money-Back Guarantee.



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