What expenses can a small business write off in Canada?

A small business in Canada can usually write off reasonable expenses you pay to earn business income, as long as they’re supported by records and allowed by CRA rules.

Common write-offs include:

• Advertising and marketing: ads, website costs, business cards, promos
• Office supplies: paper, pens, postage, software subscriptions
• Rent and utilities: business space, internet, phone, electricity, heat
• Home office: a business-use portion of home costs if you qualify
• Vehicle costs: fuel, insurance, repairs, maintenance, parking, lease costs, mileage used for business
• Meals and entertainment: usually 50% deductible
• Travel: airfare, hotels, taxis, business mileage
• Salaries and subcontractors: wages, payroll costs, contractor fees
• Professional fees: accounting, bookkeeping, legal, tax prep
• Insurance: liability, property, business interruption, professional insurance
• Bank and interest charges: loan interest, bank fees, payment processing fees
• Repairs and maintenance
• Training and education
• Licences, dues, and memberships
• Bad debts

Important limits: personal costs aren’t deductible, mixed-use costs must be split, and equipment, vehicles, furniture, and buildings are usually claimed over time through depreciation. Fines, penalties, and owner draws are generally not deductible.

Keep receipts, invoices, mileage logs, and proof of business purpose. For larger or mixed-use expenses, check the current CRA rules or a Canadian accountant before filing.