What Employment expenses can be tax-deductible by a salary employee?

Salary employees can deduct pension contributions, union dues, and professional fees, but they are very restricted in what employment expenses they can claim. Unlike individuals who run their own business, there is no general rule allowing employees to deduct any reasonable expense incurred to earn employment income. If employees are required to pay their own expenses, they can only deduct these expenses for tax purposes if their employer has signed a T2200 Form called a Declaration of Conditions of Employment allowing the employee to deduct specific expenses.

If their employer’s Declaration of Conditions of Employment allows, what other employment expenses are tax deductible?

  • Allowable motor vehicle expenses (including capital cost allowance)
  • Traveling expenses
  • Parking
  • Supplies
  • Long-distance telephone calls
  • Cell phone airtime (part of)
  • Your assistant’s salary
  • Office Rent

Work-space-in-the-home expenses: You can deduct the part of your costs that relates to your workspaces, such as the cost of electricity, heating, and maintenance. However, you cannot deduct mortgage interest, property taxes, home insurance, or capital cost allowance.

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