We know that for many small business owners and those who are self-employed, it can be difficult to step away from work long enough to take a vacation.
That’s why you might want to consider combining your vacation and business trip and be able to claim some of the expenses as business expenses.
The team of accounting and bookkeeping experts in Canwest’s Victoria and West Shore (Langford) offices can help business owners to figure out what trip expenses can be claimed as tax deductions when they extend a trip to fit in some leisure time. Sharlane Bailey, Owner of Canwest Accounting, recommends ways you can combine business with your vacation, and write off the business portion of the trip.
“This comes up fairly frequently, since a lot of small business owners need to multitask, including when they go on vacation,” Bailey says.
Most allowable business trips fall into the following categories:
- Meeting Suppliers
- Client Meetings
- Sales Calls
- Picking up Supplies
If a business owner were to attend a three-day conference in Arizona and take her family with her for a week, Bailey says she could claim the following expenses: airfare for one, the conference fees, meals for one for the three days of the conference, three days of a car rental (if applicable for getting to and from the conference) and accommodation for three nights.
In other cases, a business owner may decide to take a spouse or family along on a road trip when making sales calls or deliveries in the Okanagan – the family can enjoy the lake while one parent is in a meeting. In that case, ferry fares for the car and driver could be claimed as business expenses, as well as vehicle mileage, accommodation expenses for the portion of time devoted to business, and meals for one person.
If staying with friends or family while on a business trip, you may be able to write off the expense of taking them out for dinner in lieu of renting a hotel room.
To claim these deductions, you must document who you saw, provide paperwork (eg. conference registration), maintain a vehicle mileage log, and keep your receipts. Remember: Canada Revenue Agency (CRA) does not allow credit card statements, so ensure you save all itemized receipts and bills.
If you have any questions about claiming tax deductions from a trip that combines business with leisure, contact us and we can help you figure out what portion can be claimed.
The suggestions and advice provided by Canwest Accounting should not be relied upon in place of professional advice. You are responsible for checking the accuracy of relevant facts and opinions provided.