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Write-offs That Businesses May Not Know About
You’ve heard the word many times, and you may even remember the memorable Schitt’s Creek joke about it: Write-offs.
But what is a tax write-off, exactly?
A tax write-off is a business expense approved by the Canada Revenue Agency (CRA) that ultimately lowers your taxable income. In other words, it’s a tax deduction. Not everything can be a write-off — it needs to be considered an operational expense that allows you to continue running your business.
More obvious examples of business expenses that can be written off are charitable donations, vehicle expenses, education and training, rent or lease, work travel expenses and meals for clients and employees. But there are some less obvious purchases and payments that businesses can list as a write-off when doing their expenses.
Here are a few overlooked write-offs for businesses:
Home Office Expenses
In the era of the pandemic, home office expenses are likely a huge part of your write-offs. For business or personal taxes, you can look at reducing any home office purchases needed to run your business or effectively operate your workday. You just need to make sure your home space is a dedicated office space and a place you would meet clients and customers.
Advertising
Did you know that you can get up to 50% of the cost written-off for newspaper or magazine ads and 100% of the cost for television, radio and online ads? Now that’s a business plan worth investing in.
Research and Development
If you’re a business conducting research and development, you can get a tax incentive through the Scientific Research and Experimental Development (SR&ED) Program! Learn more about the program here.
Staff Events
Yes, you know about meals and entertainment being a deductible, but did you know the CRA allows write-offs for up to six events per year if all staff are invited? Now that’s a reason to celebrate!
Of course, when it comes to any write-off, documentation is vital. Make sure you are keeping track of your expenses. If you’re unsure of what else you can deduct, the team at Mowbrey Gil are experts ready to assist you.
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