The top 7 tax deductions most canadian business owners miss

Dec 31

Perfect for: Attracting new clients + helping current clients reduce taxes.

Introduction

Every year, Canadian business owners leave thousands of dollars on the table simply because they don’t know what they can legally deduct. Whether you’re self-employed, incorporated, or running a small side hustle, understanding deductions can dramatically lower your tax bill. Here are the top seven deductions most Canadians overlook — and how to make sure you claim them correctly.

1. Home Office Expenses

If you run your business from home, a portion of your rent/mortgage, utilities, internet, and maintenance may be deductible.

What most people miss:

Claiming a percentage of property tax
Claiming a portion of home insurance
Overlooking workspace-only supplies

2. Vehicle Expenses

From gas to repairs, you can claim business-related mileage.

What Canadians forget:

Keeping a mileage log (mandatory!)
Claiming lease payments or CCA
Deducting parking used for client meetings

3. Meals & Entertainment (Within Limits)

Client meetings, travel, and conferences often qualify.

Most overlooked:

50% of client meals
Meals while travelling for business
Event tickets tied to client entertainment

4. Professional Fees

Legal and accounting fees are fully deductible when related to earning income.

Missed deductions:

Fees for bookkeeping setup
Fees for consultations

5. Software & Subscriptions

Cloud software, CRMs, accounting tools — all usually deductible.

Overlooked:

Monthly business app subscriptions
Website hosting fee

6. Salaries & Contract Workers

Paying employees or independent contractors is deductible.

Missed items:

CPP contributions
Employer portions of EI
Payments to family members who work for the business (must be reasonable)

7. Bad Debts

If you invoiced a client who never paid, you may be able to deduct that amount.

Warning:

Keep proof that collection attempts were made.

Conclusion

Most business owners miss at least 2–3 of these deductions each year. Working with a professional accountant ensures compliance AND maximizes your refund.

If you’d like help reviewing your expenses, we’d be happy to assist.