Remote Working Tax Deductions

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Jul 27th 2016, 10:39 am

Markicof

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Joined: Jul 2016

Location: Calgary, NW

Posts: 21

Remote Working Tax Deductions

Hi Everyone.

I know there are a few very informative posts on here already about working remotely as a self employed contractor but I wanted to ask a specific question about tax debuctions, particularly from those that already do.

I will be working remotely as an electrical contractor from a home office in a rental home initially.

1.I know if the office occupies more than 10% floorspace you can claim on utilities etc but can you claim on rent?

2. Can you claim for a car? All work will be remote so I am thinking it may be hard to justify.

3. If the contract is signed before you leave the UK can you claim the flights and moving expenses?

Jul 27th 2016, 2:32 pm

Aviator

Joined: Sep 2008

Posts: 12,830

Re: Remote Working Tax Deductions

Quote:

Originally Posted by Markicof

Depends on the circumstances. If you are reporting income to CRA make sure you meet the criteria for self employed. If you only have one client , likleyhood is you won't and would be deemed an employee. CRA look closely at contractors who claim self employed.

RC4110 - Employee or Self-employed?

Legitimate business expenses can be claimed as deductions. Rent for an office would qualify. There is no limit to how much you can claim if a legitimate expanse, however there can be tax consequences the higher the percentage, especially where a home is owned. http://www.cra-arc.gc.ca/tx/ndvdls/t...sn/hm-eng.html

For any vehicle there are restrictions on what can be claimed. A van for a contractor would be easier to justify. Business mileage to and from clients is ok as well as to and from suppliers (other than the first journey from home and the last journey back home). ANy personal mileage is not deductible. If you are relocating as an immigrant, flights and moving expenses won't wash.

This all depends on whether you are a contractor or emplyee as far as CRA are concerned. They do audit tax returns, look at income compared to other workers in the same industry and certain industries where contractor status is incorrectly claimed. Good idea to talk to an accountant when you arrive.

Last edited by Aviator; Jul 27th 2016 at 2:35 pm.