What business expenses can you deduct?
JUNE 23RD, 2015
Generally you can deduct any reasonable expense you paid or will pay to earn business income, which is considered current year expense; otherwise it could be considered capital expense, which is treated differently. In order for expense to be considered current, it has to be incurred in a given year in order to generate income in the same year.
The expenses you can deduct include any GST/HST you incur on these expenses less the amount of any input tax credit claimed.
Since you cannot deduct personal expenses, deduct only the business part of expenses from business income. In addition, you cannot claim expenses you incur to buy capital property.
List of expenses
- Allowance on eligible capital property
- Bad debts
- Business start-up costs
- Business tax, fees, licences, dues, memberships, and subscriptions
- Business-use-of-home expenses
- Capital cost allowance
- Current or capital expenses
- Delivery, freight, and express
- Fuel costs
- Legal, accounting, and other professional fees
- Maintenance and repairs
- Management and administration fees
- Meals and entertainment
- Motor vehicle expenses
- Office expenses
- Prepaid expenses
- Property taxes
- Salaries, wages, and benefits
- Telephone and utilities