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Home Office for Business Use

The deductibility of home office costs to those situations where:

The following expenses can be deductible when the conditions for deductibility are met:

Expenses must be apportioned between business and non-business use on a reasonable basis, usually on the basis of floor space used. Individuals are generally advised not to deduct CCA, as this is likely to cause the business portion of the residence to lose its principal residence status.

Home office costs cannot create or increase a business loss. As a result, the total deduction will be limited to the amount of net business income calculated without reference to the home office.


Taxable entities in Canada

Three types of entities are subject to federal income taxation. They are individual (T1), corporation (T2) and trust (T3). All three of them are required to file tax return.

For income tax purposes, unincorporated business such as partnership and proprietorship are not viewed as taxable entities. Rather, income earned by unincorporated business is taxed in the hands of partners or proprietorship.


Important Dates

Individual income tax (self-employment). If you or your spouse or common-law partner have self-employment income (other than from a business whose expenditures are primarily in connection with a tax shelter), your filing due date is different from your payment due date.

Filing due date - File your income tax return by June 15.
Payment due date - Pay any balance owing by April 30.

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