It’s the little things that can add up and cost you a boat-load of money.
When you’re a small business owner, it’s nice to know you can claim a tax deduction for your home office and all the necessities that keep a home office running.
You need pens, notebooks, stamps, envelopes, paper clips, business cards and even office furniture.
Your home office and your home-office supplies become claimable if:
- The work space is where you conduct most of your work (i.e., more than 50 per cent)
- You use the space only to earn income and must use it on a regular and continuous basis for meeting clients or customers
When you fill out your T-2125, the Statement of Business or Professional Activities, you enter your stationery supplies and other office expenses on Line 8810.
What expenses can I claim?
Think about everything you need to keep your business operating.
You could claim:
- Printing supplies, such as ink cartridges and paper
- Internet access
- Pens, pencils, stamps, envelopes, file folders, notebooks
- Professional fees paid to lawyers, accountants and advisers
- Advertising costs
- Fees to networking events
- Utilities bills such as heat, electricity, water, telephone
- Home maintenance
- Cleaning supplies and/or services
If you want to claim furniture or computers and accessories, those are counted as depreciable assets and fall under Capital Cost Allowance. This also applies to that fancy new smartphone you just picked up to stay connected on the go.
The Capital Cost Allowance lets you claim the loss in value due to wear and tear or obsolescence. You claim a calculated portion each year as the equipment depreciates, and that portion depends on when you acquired the property and what CCA class it belongs to.
What do I need to make the claim?
Keep your receipts. All of them.
You must be able to prove the purchase of the items with a sales invoice or receipt.
Just remember: your home-office expenses cannot be used to create or increase a loss in your income.
Can you help?
We sure can. We specialize in small-business accounting and financial services. Contact one of our tax specialists and we can help you optimize the tax benefits and credits available to self-employed individuals and small businesses.
Fill our our contact form or give us a call at 403-226-8297.