Income Tax Write-offs in Canada


By the tax law of Canada, permanent residents, citizens and those with significant residential ties must file an income tax return with the Canada Revenue Agency. Canada has separate tax forms for federal and provincial taxes, as well as a long schedule of deductions and credits that will reduce the amount of tax owed. In addition, Canadian taxpayers don't pay tax on certain types of income -- such as employer pension contributions -- although they must declare the amount they received.

Pension Contributions

  • In Canada, employers set up registered pension plans, or RPPs, to which both the employer and employee may contribute. Employee contributions to these plans are tax deductible, while employer contributions are not included in income. Canadian taxpayers can also deduct contributions to registered or pooled retirement plans they set up themselves. The tax agency sets a deadline each year for these deductible contributions, which in 2015 fell on March 2.

Other Employment-Related Expenses

  • Other employment-related deductions include dues paid to a union or professional association, liability insurance premiums, vehicle expenses if the employee is required to work away from the employer's place of business and moving expenses if the purpose of the move is to establish a new business or to attend school. The new location must be at least 40 miles from your former location. Parking and supplies can also be deducted, under certain conditions, and anyone with a home office can also deduct related expenses.

Child Care, Support and Parental Insurance

  • Canada also allows the deduction of child-care expenses, including for caregivers, nursery schools, boarding schools and camps. If a couple is taking care of a child, the individual with the lower income can take the deduction; Canada does not have joint returns. In addition, Canada allows the deduction of court-ordered support payments, as well as a portion of premiums for the Provincial Parental Insurance Plan if you live in Quebec.

Business and Investment Deductions

  • The tax rules also allow Canadian taxpayers to deduct half of a business investment loss. They may also deduct fees paid for investment advice, tax return preparation fees if the taxpayer earned income from a business or property, legal fees connected to child support payments and interest paid on a loan taken from an insurance contract. In addition, development expenses for mining, oil or gas exploration are also deductible, whether or not the taxpayer was an active participant in the business.

Related Searches


  • Photo Credit Purestock/Purestock/Getty Images
Promoted By Zergnet


You May Also Like

  • List of Business Tax Write-Offs

    Business owners understand that the Internal Revenue Service considers a deductible business expense as one that is commonly required in a particular...

  • How to Have More Tax Write Offs

    As the old saying goes, taxes are one of only two things that are certain in this life. However, there are a...

  • How to Write Off Loan Debt

    Any amount of money that you loan to an individual and yet do not receive back qualifies for a general write-off because...

  • Tax Write-Offs for Lottery Winners

    Winning the lottery and paying income taxes on it is always better than not winning the lottery at all. However, there are...

  • Can I Claim Gas on My Taxes?

    The Internal Revenue Service lets you deduct qualified business-related expenses. Auto-related costs fall under this category as long as they meet the...

  • A List of Eligible Tax Write Offs

    Filling out a tax return can feel overwhelming, especially for those with little knowledge of how taxes work. Tax write offs are...

Related Searches

Check It Out

4 Credit Myths That Are Absolutely False

Is DIY in your DNA? Become part of our maker community.
Submit Your Work!