Way before tax times approaches, you should be gathering up your business-related expenses. What qualifies as a business-related expense? Here’s some great ones for authors.
Home is where the writing is
Where do you write? Most authors write at home, and have a space reserved for that purpose. Whether you rent or own, if you use a part of your home exclusively and regularly for the business of writing then you may be able to write off expenses that relate to the space.
Round up your gas, hydroelectricity, house insurance, maintenance (house cleaning, landscaping, etc.), mortgage interest, property taxes and city utilities, strata fees, rent. It’s best to review these with your tax advisor, and that you get the right percentage of use. Remember you need to measure the square footage of the room, and determine your home’s total square footage.
Pens and Paper Aplenty
All those office store receipts add up after a while, and you may as well use them. Your office equipment and materials that include desks, cabinets, chairs, lighting, computer and software, printers, ink, paper, pens, and other supplies.
Ding-a-ling May Be Deductible
Your cell phone or landline may be considered a business expense. You should show that the phone is used normally for business. Canada Revenue Agency seems to allow 100% of cell phone bills to be written off (at least your portion, if it’s a family plan). If your business conducts interviews, you can keep a log of the date, length, ad purpose of such calls. Of course, in today’s smartphone era, you probably use the cell to email clients, take notes, draft story outlines, or do research. Your tax advisor can help you figure out the correct deduction amounts for your phone usage, devices, service and repair charges.
Surfing Could Mean Savings
Every household pretty much has the internet these days, and you’re more than likely using it for your business. You’re probably using it for email, website, video conferencing clients, existing and new ones, doing research and fact-checking. These days it’s social media and promoting your business. Many people get their inspiration from the internet. Ideally, if you want to write off your internet service, it should be in the businesses name; you’ll pay more for it, however, CRA likes to see this.
Subscribe Your Way to Savings
Do you belong to professional organizations? How about magazines and other publications, even websites you subscribe to on a monthly basis? Associations would include ones to power up your writing, or learn more on a certain subject you’re writing about, online access to the AP Stylebook, newspapers, and more.
Fly the Friendly Skies to a Tax Write-off
Travel writers aren’t the only ones who can claim travel as a deduction. Any travel that you do may qualify for a deduction, if it gets you somewhere that’s business related. That professional conference, or event you covered, or client you met would all qualify for the travel deduction; remember parking and tolls. As for a car, if it’s a rental car then you just write off that as a travel expense. If it’s your personal car, then you must keep your mileage and all your receipts; unless you’re a corporation, then you can pay yourself per kilometer.
Your Content Creation and Business Expenses Could be Related
The content you create for clients, could lead to deductions for your business. Are you a movie or theatre reviewer? The cost of those tickets would be a write-off. A graphic designer that creates marketing materials for a beauty brand, anything purchased to better understand the user experience could qualify too. Look at the content you created over the past year, and the products or services you purchased to create that content. Your professional tax advisor should be able to give you great advice on what you can and cannot write-off.
If you want to reduce your taxable income, then look at your home office, cell phone, internet plan, dues and subscriptions, travel and the content you create. For a little bit of record keeping, and advice from a tax advisor, you can keep more money, and give less to the government.
Renting Out Your Mortgage Helper? – The Taxman Cometh
What Can I Deduct as a Business Expense?
Is Now a Good Time to Review Your Tax Situation?
Surviving A Compliance Review With Canada Revenue Agency
Have You Not Filed Your Tax Return Yet?
How do you calculate your installment payments?
Do You Have to Make Income Tax Installments?
Getting Your Tax Records Ready for Your Accountant