Four Things You Didn’t Know Were Tax Deductable

“That's a tax write-off!” — famous words you may have heard dozens of times before, whether on a TV show (any Schitt's Creek fans out there?) or from one of your financially-savvy friends…but what does it mean? 

A tax write-off can be described as a business expense that reduces taxable income on the income statement. In lamens terms, it means any expense that you incurred over the year that counts as benefiting your business could be considered a tax write-off. The most common write-offs include office supplies, like printer paper or computers, but can also include business lunches, coffees (while at work), phone bills, and more. 

Knowing what counts and what doesn’t count as a tax write-off can be super beneficial for many reasons. Being familiar with what to write off will inevitably save you money and keep you out of trouble with the CRA by not writing things off that just don’t count. So, what kind of things can you write off…other than the givens?

As Vancouver Island bookkeepers, we’re committed to ensuring you save as much money as possible while doing your taxes, and for today’s blog we wanted to give you some useful tips on what to include in your write off’s next tax season…and some of them may surprise you! So, without further ado, here are 4 things you probably didn’t know were tax deductible. 

Donations 

If you actively donate to your favourite charity, you can include that amount as a tax write-off! Talk about a win-win — giving back and also saving money on your taxes! 

Your Children

Do you have a clothing brand and your child is your IG model? Have a teenager that can help with summer office work? Perfect. You can pay them and lower the amount of overall business taxes you pay. Each year the government releases a Personal Basic Amount that individuals can make tax-free. This gives you a write-off at a lower tax rate and can help you differ money into an investment fund for your child that can support their education or their first time buying a home. We would suggest funneling their paychecks directly into an RRSP or RESP in their name. Enjoy the power of compound interest!

Botox, Veneers, and Therapy

If your company has group benefits you can opt into a medical reimbursement program (MRP). Through this program, you can funnel medical expenses through your company as a health benefit and make it 100% deductible.

Tuition Expenses

If you decide to go back to school or take a class, you can include the total amount on your tax deductions. Another win-win — education and a write-off! 

Do any of these apply to you? Let us know in the comments which of these you didn’t know were tax deductible. We hope we’ve been able to provide some valuable insight! For a more comprehensive run-down of what is and isn’t taxable, feel free to book a free intro call with our team of Vancouver Island bookkeepers! We are always happy to chat on a free intro call to discuss your write-offs and strategies for managing your books in the best way possible.