CLAIM ALL YOUR BUSINESS DEDUCTIONS ON THE T2125

If you are self-employed, also known as a proprietorship, then you are eligible to claim deductions against the income you made during the year.

If you work from home, you are able to pro-rate these expenses.

These deductions include expenses such as a portion of your rent or mortgage, insurance, bank fees, accounting, legal, utilities, office supplies, travel, automobile, parking meter fare, subscriptions, cost of goods, etc.

This 6:55 minute video from Intuit explains how to fill out the T2125 form.

A lot of self-employed people are not aware of all the legitimate expenses that Canada Revenue Agency (CRA) allows you to deduct as the cost of doing business. 

CRA did put a cap on Meals & Entertainment because it was so heavily abused. You can only claim 50% of the bill and you must be able to provide proof of the person you had dinner with. 

T2125 Statement of Business Activities, PDF fillable form

Did you know that you can claim your mileage if you keep a mileage log of your business activities?

If your business activities require you to travel using your personal vehicle, you are allowed to pro-rate your automobile costs such as insurance, fuel, maintenance and repair.

The 2018 Automobile Allowance Rates are 55 cents per kilometre for the 1st 5000 km driven, then 49 cents per km after that.