Subject: Automobile Allowances

During the current year, Jacob Lorenz leases an automobile for $450 per month, a total for the year of $5,400. He drives a total of 60,000 kilometres, of which 35,000 are employment-related. His total operating costs for the year are $15,000. His employer pays him $0.10 for each employment-related kilometre driven, a total of $3,500. What amounts should Mr. Lorenz include and deduct in determining net employment income for the current year?