Yes, you can deduct home office expenses from your side hustle income if you meet CRA criteria. You must use a dedicated workspace regularly and exclusively for business purposes, and the expenses must be reasonable and directly related to earning income. The CRA allows two methods: the simplified method (fixed dollar amount per square foot) or the detailed method (claiming actual expenses like utilities, rent, or mortgage interest). Using the home office deduction calculator can help you determine which approach saves you more. Not every room in your house counts as a deductible home office. The CRA looks for a space that you use consistently and exclusively for work. This doesn't mean you need a separate room - a dedicated desk in a corner counts. However, your kitchen table where you eat dinner and do freelance work on weekends won't qualify. Eligible expenses include: - Rent or mortgage interest (proportional to your office space) - Property taxes (your share) - Utilities (electricity, gas, water) - Internet and phone service - Home insurance (business portion) - Maintenance and repairs - Office furniture and equipment - Supplies like paper, ink, and stationery You cannot deduct meals, personal vehicle expenses, or items you
No. The CRA allows you to claim a dedicated corner of a shared room as long as you use it regularly and exclusively for business. A dedicated desk in your bedroom or a specific area of your basement can qualify, as long as you can clearly define the workspace boundaries.
Yes, as long as your home office is used regularly for your side hustle and you can document that use. 'Regularly' means ongoing and consistent, not just occasional. You calculate your deduction based on the percentage of your home used for business, so part-time work is fine as long as the space itself is dedicated.
The simplified method uses a fixed rate per square foot of office space and requires minimal record-keeping. The detailed method requires you to track actual expenses (utilities, rent, mortgage interest, etc.) and apply your home's business-use percentage to them. Detailed usually gives a bigger deduction but requires more documentation.
Not automatically, but home office deductions are a compliance area the CRA monitors. If your claim is reasonable and well-documented, you should be fine. The risk increases if your deduction seems inflated or your business income is very small relative to your deduction.
You can only deduct the business-use percentage of your internet bill. If you use the internet 50% for work and 50% for personal use, you can deduct 50% of the cost. Allocate shared household expenses proportionally based on business versus personal use.