Living the dream running a small business here on Vancouver Island or the Coast, right? The lifestyle, the people, the scenery—it’s just incredible. But let’s be real for a second. When tax season sneaks up, that dream can start feeling a bit like a nightmare. All of a sudden, you’re drowning in a sea of receipts, totally panicked that you’ve missed something important.
You’re definitely not alone. The Canadian tax code is, well, a complicated beast. Countless entrepreneurs just like you end up leaving thousands of dollars on the table every year. And why? It’s usually because they just don’t know what they’re legally allowed to claim.
That stops right now. We’re going to fix that. This isn’t just another dry, boring list. Think of this as your secret weapon to keeping more of the money you worked so hard for. Let’s get into it.
Your 12-Point Tax Write-Off Checklist
Treat these as the big topics you need to chat about with your accountant. Every single dollar you can legally write off lowers your taxable income. What does that mean for you? Less money going to the CRA and more money staying in your pocket to grow your business.
1. Home Office Expenses
Are you running your business from a spare room in Nanaimo or a cozy studio in Tofino? Awesome. You can deduct a chunk of your home expenses. And this isn’t just for homeowners—if you rent, you can claim this too.
What you can claim:
- A percentage of your rent or your mortgage interest (but not the principal payment).
- A slice of your utility bills like hydro and heat.
- A portion of your home internet bill.
- Costs for maintenance and minor repairs.
The trick is making sure the percentage you claim is the same as the percentage of your home you actually use for business. Be honest, be realistic, and keep great records!
2. Vehicle Expenses
Your car is probably your lifeline for getting around the Island. If you’re using it for work, you can deduct its expenses. The catch? You have to track your mileage like a hawk.
A simple logbook or a slick app on your phone is your new best friend. At the end of the year, you figure out the percentage of kilometres you drove for business versus for personal trips. Then you can deduct that exact percentage of your total vehicle costs, including:
- Fuel and oil
- Insurance and registration
- Repairs and maintenance
- Lease payments or something called Capital Cost Allowance (we’ll get to that!)
3. Salaries, Wages, and Benefits
This one might seem like a no-brainer, but it’s a big one. Any salaries you pay your employees are 100% deductible. This also covers the employer’s portion of CPP and EI contributions. It’s a major expense, so you want to be sure you’re claiming every penny.
4. Professional & Legal Fees
Did you pay an accountant to wrangle your books? Or a lawyer to look over a contract? Those professional fees are a business expense. Turns out, investing in expert advice isn’t just a smart move—it’s also deductible.
5. Advertising and Promotion
How do your customers find you? Whatever your answer is, it probably costs money. From Facebook ads and Google boosts to old-school flyers and business cards, all of your marketing and advertising costs are fully deductible.
6. Office Supplies
Don’t laugh at the small stuff! Pens, paper, printer ink, planners, sticky notes… it adds up faster than you think. Every little thing you buy for your office is a write-off. Hold onto those receipts!
7. Meals & Entertainment
Taking a client out for lunch to talk business? The CRA lets you deduct 50% of that cost. The main rule is that the expense has to be for the purpose of earning income. So, you can’t claim your daily coffee run, but that lunch meeting to seal a deal? Absolutely. Just keep the receipt and make a quick note of who you were with and what you discussed.
8. Business Travel
Jumping on the ferry to Vancouver for a conference? Flying out for a trade show? Your travel costs are deductible. This covers your transportation, your hotel, and even your meals (but remember that 50% rule still applies). Just make sure it’s genuinely for business and not a vacation in disguise.
9. Insurance
Protecting your business is non-negotiable, and the insurance premiums you pay are a necessary cost. This can be anything from general liability and commercial property insurance to professional liability insurance. It’s all deductible.
10. Bank Charges & Loan Interest
You know those annoying monthly fees on your business bank account? They’re deductible. The interest you’re paying on that loan you took out to buy new equipment? That’s deductible, too. It’s all part of the cost of doing business, and the CRA gets that.
11. Capital Cost Allowance (CCA)
Alright, stick with me. This is the one that sounds super complicated, but it’s really not. When you buy a big-ticket item that’s going to last for years—like a new computer, a fancy camera, or a work truck—you can’t just deduct the full price in the year you buy it.
Instead, the CRA has you write off a portion of its cost each year. This is called the Capital Cost Allowance (CCA). Think of it like this: the CRA wants you to eat a pizza one slice at a time over several years, not wolf it down in one go. It’s their way of matching the expense to the asset’s useful life.
12. Education and Training
Did you take a course to level up your skills? Or attend a workshop to learn some new software? If the training helps you run your business better, the cost is a valid deduction. Investing in yourself is one of the best investments you can make in your business.
Don’t Leave Money on the Table
Whew. That’s a lot, isn’t it? But trust me, being on top of your bookkeeping throughout the year makes a massive difference. It can turn tax time from a frantic, hair-pulling nightmare into a calm, organized process.
This checklist is a fantastic starting point, but every small business is different. Your financial situation is unique. Navigating the maze of the Income Tax Act can be tricky, and the absolute best way to make sure you’re claiming every single deduction you’re entitled to is to talk to a professional. An accountant can give you advice that’s tailored specifically to your business. If you’re ready to get some clarity and feel confident about your finances, we’d love to help; you can reach out to us for a consultation to get everything sorted out.