Save on Taxes with Business Expenses

Credit Card Machine with Receipt Paper

Common Business Expenses to Save on Taxes

Spending money is never fun, but according to Roman Playwright, Titus Maccius Platutus, “you must spend money to make money”. It is also very important that you track these business expenses as they will reduce the taxes you owe. What expense can I claim, you ask? It is tricky, and we’d like to share with you a few tips to help you understand what can be claimed. Our goal is to help you maximize your return while still being compliant.  If you require help filing your corporate or individual taxes, please book an appointment with us. 

Here are some common business expenses you can use to save taxes:

Advertising and Promotion:

You can deduct expenses for advertising and promotion including Canadian newspapers, TV, and radio stations as well as digital marketing on LinkedIn, Google, and Yelp.   

Restrictions: If you advertise with a foreign broadcaster such as ABC or CNN, you cannot use it as an advertising expenditure.   

Business start-up costs

Such as incorporation costs, initial cost of goods sold (inventory), business set up fees, accounting software.

Business tax, fees, licenses, and dues

You can expense some business tax and annual license fees that are required to run your business.  

Restrictions: You cannot claim income tax paid. 

Delivery, freight, and express

If you must post products to customers or mail anything on their behalf, postage and shipping fees are deductible


Any commercial insurance premiums on buildings, machinery, and equipment used in your business.   

Restrictions: You cannot claim life insurance premiums unless the policy is being used for collateral in a loan related to your business. 

Interest and bank charges

Bank fees such as wire fees, monthly account charges and interest on loans for the business such as credit card interest or small business loans.

Legal, accounting, and other professional fees

Business, accounting, and legal consulting services that you use for your business can be used as an expense.   

Example: accounting services to file your tax returns, HST/GST, T4s, bookkeeping services or if you need consultation for intellectual property. 

Restriction: Legal, accounting fees for purchasing a capital property (boat, office building). Add this to the cost of the property and expenses per the CCA (Capital cost allowance). 

Meals and entertainment (allowable part only)

You can claim 50% of food, beverages, and entertainment expenses. 

Example: building relationships by taking clients out to dinner, tickets for entertainment or sporting events/cover charges. 

Office expenses

Pens, pencils, stationary.   

Restrictions: Assets such as desks, chairs – these will have to be capitalized and expensed per the CCA. 


This is an expense you pay ahead of time.  You can only claim the expenses that have already been incurred. 

Example: If your fiscal year end is December 31, 2020 and you pay a full year of rent on June 30, 2020, you can only deduct one-half of this rent as an expense in 2020. The other half would be an expense in 2021 

Salaries, wages, and benefits (including employer's contributions)

You can claim gross salaries and benefits as an expense.   

Restrictions:  If you own the corporation, you can’t claim the dividends! Owner dividends are considered after tax income and are treated differently.  


These are costs that are required indirectly to perform the services or provide goods. For example – mop & bucket for a cleaning service


You can deduct travel expenses you incur to earn business and professional income. Travel expenses include: 

  • public transportation fares – Uber, Lyft, Taxi, Public Transportation, Airfare 

  • hotel accommodations 

  • Meals (50%) 

Business Use of Home expenses

If you use your home as an office, you can claim only a portion of your home expenses as business expenses.  

Example: Home Insurance, Mortgage Interest, repairs & maintenance, property tax, rent, utilities, telephone, internet 

Restriction: You cannot claim the principal payment of your mortgage as the house is treated as capital asset (and needs to be expensed per CCA) 

Vehicle Use

If you use your personal vehicle for work, you can claim only a portion of vehicle expenses. 

Example: gas, insurance, repairs & maintenance, license renewal fee, lease payments, interest 

Restrictions: if you purchase your vehicle, you can only claim the interest portion of the vehicle payments. You cannot expense the principal payments. 

Need help with your Business Expenses?

Please note that it is not over when you file the tax return!  CRA has up to 7 years to audit you so be sure to keep your receipts in a safe place. AgileCPA recommends taking a photo of your receipts and uploading to cloud based storage. You can separate the receipts alphabetically or by year. We also advise you to log your expenses in excel or an accounting software on a regular basis, so you do not have to go through 12 months of receipts and bank statements at year end. 

We hope you found this guide useful. Please review our services for your accounting needs and let us know in the comments if there are any accounting/business related topics you’d like to see from us.


man writing notes while on laptop with calculator and receipts on table

The Importance of Bookkeeping and the Danger of Not Doing It

Why Do You Need A Bookkeeper? Whether you’re an established business or just starting up, you most likely have an endless to-do list. As a result, bookkeeping is probably the last thing on your mind. It’s common for small business owners to neglect their bookkeeping function until tax time rolls around, but is this really

Read More »
Person typing in numbers into calculator

What Do Bookkeepers Do

Why Do You Need A Bookkeeper? If you’re a first-time entrepreneur, there are probably a few questions that keep you up at night: “Do investors expect me to wear a tie to meetings?”, “Are standing desks really worth it?”, and “Will anyone mind if I take a client call in this Chipotle?”. While knowing whether

Read More »
Camper Van facing mountains

What is the Ontario Staycation Tax Credit?

How to Claim Ontario’s Staycation Tax Credit on Your Tax Return The recent pandemic has taken a toll on the travel industry, with overall tourism to Ontario showing a $24.90 billion decrease in 2021 alone. In an attempt to increase domestic travel, the Canada Revenue Agency passed a temporary Ontario Staycation Tax Credit for 2022.

Read More »