Assuming you aren’t expecting to owe any additional income tax for the 2018 tax year, self-employed individuals have until June 17 to file their income tax forms.
That gives you a bit more time to track down those last few receipts that might still be stashed in the glovebox of your vehicle or hiding in your wallet.
Most small business owners have several expenses they can use as deductions when filing their tax return. Sharlane Bailey, Owner of Canwest Accounting, addresses some of the common questions small business owners ask about business expenses.
How do I write off vehicle expenses for my personal vehicle?
First of all, it’s important to keep a detailed log of your business-related mileage. Additionally, keep all your gas and vehicle maintenance receipts for the year, as well as auto insurance and lease or loan payments. The percentage your vehicle is used for business can be deducted from your taxes. We can help calculate that for you.
Can I write off clothing on my taxes?
Only clothing that has a business logo on it can be written off as an expense. You can’t write off regular business attire just because you need to dress professionally. Haircuts are also not a tax write-off.
How do meal expenses work? What if I’m meeting a client and we split the bill?
The only way you can deduct a meal expense is if you pay for the other person’s meal. Your own meal is not a deduction. Make sure to write on the receipt who you were meeting.
Can I write off meals when I’m travelling for business?
As long as you are away for 12 hours or more – overnight – you can write off 100% of your meals as a business expense. Unfortunately, if you are based in Victoria and drive to Nanaimo for a few hours to visit a client, that isn’t considered business travel, so your meal cannot be written off.
Can I write off gifts for clients?
Yes, client gifts can be claimed as a deduction. Make sure you write on the receipt who you gave it to, why and provide the client’s address.
What qualifies as an office supply versus a capital expense?
You need to ask yourself will it last longer than a year and does any one item cost more than $500? Obviously, a new computer or desk will last longer than a year, so those would be capital expenses, but printer ink would be a regular office expense.
The exceptional accountants and bookkeepers at Canwest Accounting prepare hundreds of tax returns for small business owners each year and can help you. Call to make an appointment or drop in at either the Victoria or Langford location.
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.