The 4 Most Common Tax Write Offs and Deductions for Small Business

The 4 Most Common Tax Write Offs and Deductions for Small Business


(soft music) – As a business owner, you care about two things
and two things only that’s increasing revenue
and decreasing expenses. My name is Shayan Rashid, and in this video we’re going to discuss the four largest expenses that you can deduct on your tax return. Let’s start with home office expenses. This could be the largest expense area that you can deduct against
your business income, but you can only deduct
the amount in proportion to what you actually use
for business purposes. These expenses could
include mortgage interest, property taxes, utilities, maintenance and any other upkeep
expenses that you incur to maintain your property. Second, major expense that you can deduct are automobile expenses. These include things such as oil and gas, maintenance also tolls and parking. It’s important to remember that you can only deduct
the amount in proportion to what you actually use
for business purposes and not the personal portion. You can deduct the capital cost allowance or the amount of the
vehicle price up to $30,000. Now let’s talk about capital assets. This is an expense that you
can deduct over multiple years because it has a larger value and it’s gonna provide
benefit to the business over two, or three, four, five years. These expenses include equipment, vehicles or even upgrades to your property. The last group of expenses
that we’re gonna discuss are those that are industry
specific or just general to you. You have to remember as long
as you incur the expense with the intention to
earn business income, then there’s no issue at all, and you can deduct it on your tax return. As long as you have documentation
to support your expense and the amount is not
specifically prohibited under the Income Tax Act, you can deduct it and
it’ll be no issues at all. In case there is an audit, you have all the documentation
to support your expense. If you have any questions about what expenses are deductible
on your tax return whether it be personal or corporate, make sure you reach out to us and schedule a free consultation with one of our accountants.

One comment

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