Small Business Tax Preparation: Canadian Tax Deductions You Should Know

Small business tax preparation

When it comes to small business tax preparation, two things are vital: prepare early and learn what deductions you qualify for. Filing corporate taxes can be overwhelming, and many businesses can miss out on chances to save valuable money simply by missing a deduction. These are just a few of the deductions you don’t want to miss this tax season. 

Automobile Expense

We’ve talked about what kind of automobile expenses you can write off if you use your vehicle for personal and business use. Any form of work vehicle can also be written off if you own the vehicle for the purpose of the company. You can deduct the fuel costs, insurance costs, and necessary maintenance and repairs. 


Insurance is just a part of owning a business and will be specific to your business’ needs. You’ll have insurance on buildings and equipment required for the company, and you can deduct these commercial insurance premiums. If you have a home-based business, you can still claim your insurance, but it must be claimed under business-use-of-home expenses

Supplies & Equipment

Any supplies required for the business’ operation can be claimed as deductions on corporate tax. For example, this can include janitorial equipment for a cleaning company, display shelving for a retail store, or tables and chairs in a restaurant.

Office Supplies

Unlike the supplies mentioned above, office supplies are the little administrative things like paper and pens. These can be claimed for business-use-at-home expenses in the specific section for home-based businesses, or they can be claimed for larger sized businesses that have a physical location separate from your home. 

Mortgage Interest, Property Tax, or Rent

You’re going to have to pay for a space to work. The interest on your home’s mortgage can be deducted if your office space is a percentage of your overall square footage. This is, of course, for those who will be looking at the business-use-at-home expenses section. Alternatively, if you own commercial space or are renting a commercial location, you can still deduct these expenses.


Gas, oil, electricity, internet, telephone, water, or waste removal fees — these are all examples of utilities your business requires that you can claim as deductions. 

Business Tax, Fees & Licenses

You can deduct any business fees related to licensing, business tax, and dues for memberships not related to sports, dining, or recreational clubs. 

Employee Costs

Hiring employees comes up with a variety of costs, including wages, salaries, and benefits. You can deduct Canadian Pension Plan and Employee Insurance Premiums as well as gross salaries. Think of it all as money the company made that you no longer have as a profit. It’s still an operating expense, and your employees will be paying income tax on their wages. 

Professional Fees

As a business owner, you may find yourself hiring an accountant or an accounting firm. However, you can deduct the fees you’d pay for professional services, such as an accountant, business consultant, or a lawyer.

Management or Administration Fees

We’ve all had to pay bank fees on our personal bank accounts. You can deduct these kinds of administrative and management fees in your corporate tax filing.


Any advertising costs can be deductible. Newspapers, radio, or television ads all qualify. However, they must meet specific Canadian content or ownership requirements. Unfortunately, these deductions don’t qualify when it comes to advertising on foreign websites, television, or radio stations, for example. 

Bad Debts

If you have an accounts receivable invoice that’s outstanding, you can deduct this if you already included it as income for the tax season you’re filing for. 

Tax season can be a confusing season for many business owners. Small business tax preparation can be just as complicated as that of a large corporate tax filing. A qualified accountant can help you to navigate the deductions available to you. At Genesa, we’re committed to helping you find all the ways to make your business succeed. Get in touch today for help keeping your hard-earned money in your pocket this tax season.