Yes, you may be able to deduct meal and vehicle expenses related to client meetings, but the CRA has strict rules about what counts and how much you can claim. Meal expenses are typically only 50% deductible (except in rare cases), while vehicle costs must be directly connected to business activity and properly documented. The key is keeping detailed records that prove the business purpose of each expense. When you take a client or colleague out for lunch to discuss business, this CRA rule may apply to you: only 50% of the cost is deductible as a business expense. This applies to most meals and beverages provided to employees or clients. However, there are exceptions where this rule may not apply: - Meals provided during a team-building event for employees - Food and beverages sold as part of your business (like a restaurant or catering company) - Meals provided at a business convention or symposium where the main purpose is business education For a client lunch that costs $80, you can only claim $40 as a business deduction. The remaining $40 is considered a personal expense. Vehicle costs used for business purposes are generally deductible.
No, the CRA generally only allows 50% deduction for meals and beverages provided to clients or employees. This applies even if the meal is directly connected to business activity. Exceptions exist for certain business events like seminars or employee team-building activities, but standard client meals are limited to 50%.
Track your total driving for the year and determine what percentage is for business use. If you drive 20,000 km total and 12,000 km is business-related, your business use percentage is 60%. You can then deduct 60% of your fuel, maintenance, insurance, and other vehicle costs.
Yes, keep receipts for all meal expenses along with notes about who attended, the date, and the business purpose. The CRA requires this documentation to verify that the expense was legitimately business-related and not personal spending.
Yes, parking fees and tolls directly related to business travel are deductible vehicle expenses. These are separate from meal expenses and follow different rules, so you can deduct 100% of legitimate parking costs for business purposes.
Keep all receipts and documentation for at least six years from the end of the tax year in which you claimed the expense. The CRA can request these records if they audit your return, so thorough documentation is essential protection.