Other types of business expenses that you may use as income tax deductions include advertising expenses, accounting fees and legal fees. And there is an "Other" category of business expenses that you may use for income tax deductions that don't seem to fit anywhere else. Check through your business expenses for these potential income tax deductions:
Have you deducted all of your allowable advertising expenses?
The costs of advertising your small business will be business tax deductions, if the advertising venues are Canadian. That is, you can deduct the cost of advertising your business in a Canadian newspaper, magazine, or on a Canadian TV station or radio station as a business expense.
But the Advertising section of the Business and Professional Income Guide cautions that you can't deduct expenses "for advertising directed mainly to a Canadian market when you advertise with a foreign broadcaster; or in an issue of a non-Canadian newspaper or periodical."
Presumably, then, you should also be able to deduct the cost of advertising in a Canadian e-zine or on a Canadian web site as a business expense, but not the cost of advertising in e-zines or web sites that originate in other countries.
Have you deducted all of your allowable 'other' expenses?
This catch-all category of business expenses covers everything from Disability-Related Modifications and Small Tools through PHSP (Private Health Services Plan) premiums. If you've incurred business expenses that don't seem to fit into any other category, chances are good they'll fall into this one.
Have you deducted all of the fees related to legal and accounting services?
All of your accounting and legal fees are legitimate business expenses. You can also deduct consulting fees, such as the cost of getting professional advice about maintaining your books and records.
These are only some of the business expenses that qualify as income tax deductions if you're operating a small business, according to the Canada Revenue Agency (CRA). It's worth taking the time to be sure that you're deducting all of the business expenses you're entitled to because your business expenses will make up the bulk of your small business tax deductions.
And if you're in doubt about a particular expense you've incurred over the past year, remember, consulting your accountant is not only the smart thing to do, but tax-deductible, too.
For more information on potential business income tax deductions, such as maximizing your non-capital losses and Capital Cost Allowance, see 8 Tax strategies to Maximize Your Business Income Tax Deductions.
