Other business expenses

There are expenses you can incur to earn income, other than those listed on Form T2125. Enter on this line the total of other expenses you incurred to earn income, as long as you did not include them on a previous line. You have to list these expenses on the form.

Some of the more common ones are:

Disability-related modifications

You can deduct expenses you incur for eligible disability-related modifications made to a building in the year you paid them, instead of adding them to the capital cost of your building.

Eligible disability-related modifications include changes you make to accommodate wheelchairs, such as:

You can also deduct expenses paid to install or get the following disability-related devices and equipment:

Computer and other equipment leasing costs

You may lease:

If so, you can deduct the percentage of the lease costs that reasonably relates to earning your business income. You can also deduct the percentage of airtime expenses for a cellular telephone that reasonably relates to earning your self-employment income.

If you buy a computer, cellular telephone, fax machine, or other such equipment, you cannot deduct the cost. You can deduct capital cost allowance and interest you paid on money you borrowed to buy this equipment that reasonably relates to earning your business income.

Property leasing costs

Deduct the lease payments incurred in the year for property used in your business.

If you lease a passenger vehicle, go to Motor vehicle – Leasing costs.

If you entered into a lease agreement, you can choose to treat your lease payments as combined payments of principal and interest. However, you and the person from whom you are leasing have to agree to treat the payments this way.

In this case, the Canada Revenue Agency considers that you:

You can deduct the interest part of the payment as an expense.

You can also claim capital cost allowance on the property.

You can make this choice as long as the property qualified and the total FMV of all the property leased is more than $25,000. For example, a combine or fishing boat, leased with a FMV of $35,000 qualifies. However, office furniture and vehicles often do not qualify.

To treat your lease this way, file one of these forms with your income tax return for the year you make the lease agreement:

Convention expenses

You can deduct the cost of attending up to two conventions a year. The conventions have to meet the following conditions:

This second limit may not apply if an organization from another country sponsors the convention, and the convention relates to your business or professional activity.

Sometimes, convention fees include the cost of food, beverages, or entertainment. The convention organizer may not show these amounts separately on your bill. In this case, subtract $50 from the total convention fee for each day the organizer provides food, beverages, or entertainment.

You can deduct this daily $50 amount as a meal and entertainment expense. The 50% limit applies to the daily $50 amount.

Food, beverages, or entertainment at a convention do not include incidental items such as coffee and doughnuts available at convention meetings or receptions.

Allowable reserves

You can deduct an amount for a reserve, contingent account, or a sinking fund as long as the federal Income Tax Act allows it and the amount is reasonable.

Private health services plan (PHSP) premiums

To find out what the Canada Revenue Agency considers a private health services plan (PHSP) as of January 1, 2015, go to New position on private health services plans – Questions and answers.

You can deduct premiums paid to a private health service plan (PHSP) if you meet the following conditions:

You cannot claim a deduction for PHSP premiums if another person deducted the amount, or if you or anyone else claimed the premiums as a medical expense.

For your premiums to be deductible, your PHSP coverage has to be paid under a contract with one of the following:

For the purposes of this claim, the following terms apply:

Undeducted premiums

If you deduct only part of your PHSP premium at line 9804 for farming or line 9270 for fishing, and you paid the premium in the year, you can include the undeducted balance when you calculate your non-refundable medical expense tax credit. For more information, go to Line 33000 and 33199 – Eligible medical expenses you can claim on your tax return.

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