Entrepreneurship & Small Business

Home-use for small business as expense

  • Last Updated:
  • Jan 14th, 2020 8:48 am
Feb 7, 2019
37 posts

Home-use for small business as expense

Hi there. Here is the situation I am facing.
There is myself and my wife working as employees for my small business.
I am based in another province, trying to develop my business there, whereas my wife is taking care of the business in the province where the business is registered.
Since both of us are working for the business in two different homes, is it possible to include the use of both homes as a business expense (a portion of the rent of each home, of course)?
1 reply
Deal Addict
Dec 12, 2009
3699 posts
Trick question?

On a more serious note.
If you look at the guide to completing the T2125 https://www.canada.ca/en/revenue-agency ... cch3ln9945
which says:
Line 9945 – Business-use-of-home expenses
You can deduct expenses for the business use of a work space in your home, if you meet one of the following conditions:
  • it is your principal place of business
  • you use the space only to earn your business income, and you use it on a regular and ongoing basis to meet your clients, customers, or patients
Since you didn't mention clients, customers or patients - one would think you could only have one principal place of business.

All is not lost though. Since you mentioned that both are employees this link might help:
https://www.canada.ca/en/revenue-agency ... enses.html
which says:
Work-space-in-the-home expenses

You can deduct expenses you paid in 2018 for the employment use of a work space in your home, as long as you meet one of the following conditions:
  • The work space is where you mainly (more than 50% of the time) do your work.
  • You use the workspace only to earn your employment income. You also have to use it on a regular and continuous basis for meeting clients, customers, or other people in the course of your employment duties.
Keep with your records a copy of Form T2200, Declaration of Conditions of Employment, which has been completed and signed by your employer.
IOW, you will need to do your research & determine how your situation meets the various definitions. I'd suggest you consult with a professional to determine your specific situation.
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