Personal Finance

Home office expenses for corporation

  • Last Updated:
  • Jan 12th, 2023 8:10 pm
[OP]
Sr. Member
Nov 23, 2001
757 posts
241 upvotes
Montreal

Home office expenses for corporation

Can anyone do a sanity check for me? about 2k of eligible home office expenses (Total expenses x percentage of home used = 2k)
I found the following:
"Business-use-of-home expense is charged against your shareholder loan account (as though you made a loan to your corporation by paying for its share of these expenses). This reduces your shareholder loan balance for the year and the amount of the salary/dividend that you will reflect on your personal income tax return"
from "https://www.mclenehan.com/articles-and- ... e-expenses"

Does it mean that on top of reducing my corp taxes, I can transfer taxe free the amount to my personal account if no shareholder loan nor salary has been taken? What if a 60k salary has been taken? Does it mean, a 58k is what I should be declaring?
Thx
2 replies
Deal Addict
Mar 3, 2018
3054 posts
3432 upvotes
GTA
Assuming you paid the home office expenses personally then yes that amount can be withdrawn from the corporation on a tax free basis. Meaning if you withdrew $60K from the corporation then only $58K would need to be reported as salary or dividends.

In the corporate books you would debit office expenses and credit the shareholder loan account. When paying you would debit the shareholder loan account and credit cash.
[OP]
Sr. Member
Nov 23, 2001
757 posts
241 upvotes
Montreal
DaveTheDude wrote: Assuming you paid the home office expenses personally then yes that amount can be withdrawn from the corporation on a tax free basis. Meaning if you withdrew $60K from the corporation then only $58K would need to be reported as salary or dividends.

In the corporate books you would debit office expenses and credit the shareholder loan account. When paying you would debit the shareholder loan account and credit cash.
Thx Dave. That's what I thought.
Cheers

Top