Can AI credits be deducted as a business expense in Canada?

Yes — in Canada, AI credits are often deductible as a business expense if they’re bought and used to earn business income, and the amount is reasonable.

What to keep in mind:

• Claim only the business-use portion if there’s any personal use.
• Keep invoices, receipts, payment records, and notes showing the business purpose.
• They’re usually treated like software, subscriptions, cloud services, or online tools.
• If you’re GST/HST-registered, you may also be able to claim input tax credits if the invoice supports it.
• If you prepay for a large block of credits or they cover future periods, you may need to spread the deduction over time.
• If the provider is outside Canada, keep the supplier details, date, currency conversion, and any tax charged.

For employees, the rules are stricter and often depend on employer documentation, so business owners and self-employed people are the clearest case.