Rent paid to your landlord for the use of office space is tax-deductible. Similarly, the amount that you spend on legal fees in the ordinary course of operating your business is tax-deductible. Accounting and Legal FeesĪnother way of reducing your taxes is by deducting fees paid to your accountant for preparing your income tax return. This is referred to as Capital Cost Allowance. If you own your vehicle, then you can claim depreciation for 30% of the cost of the vehicle each year under the declining balance method. You are required, by the CRA, to maintain an accurate logbook in order to verify the amount your car is being used for personal and business purposes. For example, if you drove 5,000 kilometers in the year for business purposes and 20,000 kilometers in total for the year, then you can write-off 25% of your vehicle expenses. Vehicle ExpensesĪs a small business owner in Canada, you can deduct vehicle expenses.Ī number of vehicle expenses that you can claim are determined as a percentage of your business mileage in the year over your total mileage in the year. If you work from a home office, you will be eligible for deductions on certain home-office related expenses.Ī number of home-office expenses that you can write off are determined by the percentage that your home office space is of the total size of your home. The most common tax write-off for a small business in Canada is home-office expenses. If you own a small Canadian business, it is beneficial to claim these 8 tax write-offs, as they will help reduce your business’ taxable income and taxes payable.
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