You can generally deduct business expenses – if they are incurred to produce income. If you claim expenses, you must be able to back up your claim. You do this by keeping all your business-related vouchers and receipts, and by recording all your expenses in a journal. Examples of expenses you can deduct and a full list from the CRA.

  • accounting/legal fees
  • advertising expenses
  • professional fees and dues
  • license costs
  • interest and bank charges
  • meals and entertainment* (check rules)
  • maintenance, repairs and vehicle expenses
  • use of a workspace in your home
  • inventory and costs of goods sold

Related information is available at the CanadaBusiness website. See also the CRA’s ‘Business and Professional Income T2125’ tax guide. This form is attached to your Personal Income Tax Return.

Incorporations file T2 form on their fiscal year end.