When you run a side hustle in Canada, most reasonable supplies and equipment you buy to earn income are deductible business expenses. This includes items like software subscriptions, tools, craft materials, office supplies, and equipment under a certain cost threshold. The key is that these items must be directly used to earn your side hustle income, not personal items. The CRA allows you to deduct both small everyday supplies and larger equipment purchases, though very expensive items may need to be depreciated over time rather than claimed all at once. Supplies are materials you use up or consume while running your business. They're typically lower-cost items that don't last more than a year. Common examples include: - Office supplies (paper, pens, notebooks, ink) - Craft or production materials (fabric, wood, paint, yarn) - Cleaning or maintenance supplies for your workspace - Packaging materials for shipping products - Software subscriptions and digital tools - Stock photography or design resources - Postage and shipping labels - Professional memberships or certifications needed for your business As long as these items are used exclusively or primarily for your side hustle, you can deduct the full cost in the year you buy them.
If it costs $500 or less, you can usually deduct the full cost in the year you bought it. For items over $500, you'll claim a portion each year through Capital Cost Allowance (CCA), which spreads the deduction over the item's useful life.
You can deduct office supplies, craft materials, software subscriptions, packaging, shipping materials, and professional memberships, as long as they're used for your side hustle. These items are typically consumed within a year and cost less than equipment.
Yes, but only the business-use portion. If you use your WiFi 60% for side hustle work and 40% for personal use, you can deduct 60% of the cost. Keep detailed records of how you calculated this percentage.
Yes, the CRA expects you to keep receipts and invoices for all business expenses. Having organized documentation protects you if your return is reviewed and helps you track deductions accurately throughout the year.
Yes, supplies bought in bulk are typically deductible in the year you purchase them, even if you don't use them all immediately. As long as they're reasonable business supplies for your side hustle, the CRA allows the deduction.