one of the best parts about running a small business aside from obviously being your own boss which is awesome is the write-offs but if you're a very new small business or maybe you aren't like me he's been doing it for a little while but you've realized there's only a few months left in the year and yeah you need some more tax deductions ASAP well you've come to the right place in this video I'm going to share the top 10 tax write-offs for Canadian small businesses that you should absolutely know about hey my name is Jessica Morehouse and this channel is about all things money so if you want to continue to expand your knowledge and learn about entrepreneurship and taxes but also personal finance and investing and everything in between make sure to subscribe to my channel and hit that notification Bell so you are notified the next time I have a brand new video now before we Dive Right In because there's quite a bit to get into a big thank you to reinvest wealth for sponsoring this video reinvest wealth is a cloud accounting software based out of Quebec and they help Incorporated Canadian small businesses streamline their finances with smart accounting tools their base accounting software is absolutely free but they also offer all-in-one plans for businesses who want to work with expert CPAs to help their tax filing and accounting needs and their brand new recommendation engine can also help you find tax write-offs I mentioned in this video and many others that I didn't include I'll share a bit more about their platform later on but for all of you who've been commenting on my past videos asking me for accountant recommendations this may be the solution you've been looking for to learn more about reinvest wealth all you have to do is go to reinvestwealth.com or click the link that I've included in the description for this video but uh you know I've got quite a bit to share with you in this video so let's get to it first things first let me be very clear and clarify this what exactly is a write-off I think a lot of people use the term and they don't know what it means it always reminds me of that Seinfeld episode where Kramer and Seinfeld are arguing about oh just write it off just write it off and neither of them know what the heck write-off is a write-off is simply another way to say tax deduction and a tax deduction is simply a way for you to subtract that amount from your taxable income which will then lower your overall tax bill for example let's pretend that you're self-employed and you earned 100 000 in the calendar year and let's say you would a bunch of qualifying business expenses that added up to twenty thousand dollars you would deduct twenty thousand dollars from the one hundred thousand dollars you earned to get to eighty thousand dollars eighty thousand dollars is the amount that you would have to pay taxes on not the original one hundred thousand dollars the logic is the more tax deductions you claim the low your taxable income becomes and subsequently the lower your tax bill to the CRA becomes as well one more thing because I see this all the time especially my comments or online especially with uh new small businesses not all business expenses qualify as write-offs a qualifying business expense needs to be seen Through The Eyes of the CRA as an expense that you incurred because you needed to either continue to operate your business or to generate income for your business so it's really important for you to know before you spend any money whether an expense is actually a write-off or does not qualify because if it doesn't qualify you spent the money and you don't get that tax benefit now if you want to learn a little bit more about self-employed taxes and I'm sure you may I do actually have a video that goes through some of this I also have another one that's all about sales tax in Canada so make sure to check out both of those videos I will link them in the description for this video okay so now that you know what a write-off is let's discuss what some business expenses that qualify as write-offs are and let's start with the one that you are experiencing and seeing right now advertising and marketing okay so you know how I mentioned at the beginning of this video that reinvest wealth is sponsoring this video they are paying me a fee to mention them throughout this video great for me also great for them because that fee qualifies as an advertising and marketing tax deduction other examples that would qualify under that advertising and marketing category would be your website hosting and registration paid search results uh display ads on a website uh there's also kind of the more traditional advertising and marketing that we kind of think of such as a TV or radio spot but there's other things that could qualify such as you know a podcast ad or even if you want to host an event where you would promote your business to customers or potential customers that would qualify too another great write-off is travel expenses and I think often when people think about travel expenses for write-offs they usually think of some Grand trip where you have to take a flight somewhere and you have to pay for hotel accommodation it does not have to be that grand of a trip for it to qualify as a travel business expense you may not realize this but you can deduct things like a bus ticket a train ticket an Uber if you had to incur that cost in order for you to generate income for your business as an example that I share often um I you know one of the things I do in my business is public speaking and often it is on the other side of town or someplace not close and uh if that's the case I'm probably honestly not going to take transit because I don't want to like ruin my hair makeup or anything like that so I'll probably take a taxi or an Uber and so I uh pay for that and then I save those receipts and then I claim them on my taxes because it does qualify as a travel business expense because guess what I needed to take that Uber or taxi in order to be at that speaking game in order to get paid another write-off that you may be able to claim are professional dues so I am an accredited financial counselor Canada in order for me to continue every single year to to use that designation I have to pay an annual fee to an organization luckily it is a write-off so I get to claim that on my taxes another example would be if you were a doctor or a lawyer um likely you have professional dues in order to keep your status so that would be a write-off another thing that you can also claim though is if you have to uh pay for professional liability insurance or malpractice liability insurance you can claim those premiums as well speaking of insurance another write-off is commercial insurance so if uh you for your business run uh one where you have a building or a Machinery or equipment and you need Commercial Insurance to protect yourself well the good thing is not only are you protecting your business by having the insurance which is always a good idea but also you can write off those premiums as a tax write-off another write-off is uh and thank goodness for it bank and payment processing fees so I know I've talked a lot on this channel I'm sure because I talk about it a lot uh about Bank fees and I can't stand them and when it comes to your personal banking there are a lot of great options for no fee Banks awesome when it comes to a small business especially if you're Incorporated like myself not a lot of options or the ones that do exist not super robust may not offer all the features that you need so you're probably going to be paying some Bank fees and not only that you're also likely paying some Payment Processing fees you know if you sell something online or in your store I mean you've got to process those credit card those debit payments somehow and you're going to be paying a fee for that so as a little example for my business although a lot of the work I do is just you know invoicing you know clients and things like that a lot of it also too is you know some of the products that I sell so I have digital budget spreadsheets that I sell on my web website I also have an online course my wealth building blueprint for Canadians course and in order to process those payments from customers I have to use an app called stripe and they take a percentage of every single transaction and I gotta pay that money and it sucks and it's not cheap the good thing is all of those Bank fees all of those stripe fees I do get to claim as a tax deduction so that is something it's not great I wish we just had lower fees or no fees but at least we we have that right off Now sort of along the same lines uh you can also write off interest on a loan now if you have to take out a business loan from A bank for business purposes or you're going to use that loan to acquire property for business purposes you can write off the interest that you're paying on that loan nonetheless you are still taking out a loan and you still have to pay that interest and pay back whatever you borrowed but this is one of the few circumstances in which there is a slight tax benefit to taking on debt not only that and this is actually pretty cool in case you do want to you know pay off that loan early if your bank charges you a penalty or a fee for paying your loan back before its due date you can also write that off as well another great write-off or you know series of write-offs is your business use of Home expenses now I've always run my business from home and not only is it a magical thing because I can work in my pajamas but the write-offs are pretty amazing as well so I I'm able to claim a portion of my like heat electricity water or property taxes mortgage interest goes on and on and on there's a whole list of things that I can claim because I'm running my business from home now one thing I want to get clear because I feel like a lot of people get really excited about this and get a little confused about how it works I cannot claim 100 of these uh expenses as tax deductions only a percentage so I can only claim a certain percentage of my home that I use for business purposes only another thing I also want to share too if you do not own your home you can claim your rent so even if you're renting you can claim that as a tax deduction as well and next we've got professional fees now if you watch my recent video about um a sole proprietorship versus Corporation and I shared my experience of being a sole proprietor for about five and a half years and a year ago incorporating my business the one thing I shared is I'm spending a lot more money on professional fees now that I'm Incorporated the good thing is those fee and I'm talking about you know legal fees accounting fees and Consulting fees um you can write those off so that is one kind of nice Silver Lining so if you you know also have to work with a lawyer or a bookkeeper or accountant or consultant save those receipts save those invoices because those can be considered a tax deduction next if you have to purchase office expenses for your business the good news is you can write those expenses off when I say office expenses I'm really talking about some small items that are necessary for you to run your business such as printer ink paper pens notebooks Post-its highlighters pencils things like that bigger things such as filing cabinets Furniture even calculators do not fall under the office expense category these items would actually be categorized as capital items and that's because they will depreciate in value over time they may wear out or become obsolete because of this you can't claim the full amount is a tax deduction in the year that you paid for that item instead what you have to do is you actually have to claim the deduction over a period of years and lastly we have office supplies which yes is different than office expenses even though they sound like the exact same thing they are different so examples of things that I spend money on that would fall into that office supply category honestly most of my money goes towards subscriptions of things and like applications so you know like Adobe products Dropbox hello sign loom oh gosh there's a bunch more that I could not think about at the top of my head but I've got them written down somewhere but bring this back to reinvest wealth if you use one of their all-in-one paid plans you could write that cost off so it would be a tax deduction and now since I did just mention reinvest wealth let me show you exactly what it is and how it works alright so this is me inside my own reinvest wealth account um what's kind of cool about reinvest wealth is it has you connect it to your Google account which I do I use G suite for my email and I use Google Drive for all of my documents so it took me literally two seconds to create an account because you just have to connect it to your Google account and then just for the purposes of this video I have kind of put put in some dummy information just to show you what it all looks like so as you can see you can connect your bank account so if you just click on there you know this has a fake uh vemo account but you can connect a bunch of different banks here so as you can see there's a bunch of different banks that you can connect it with and if you don't see your institution you can actually just put it in the search and then it'll put it in there so for example maybe I am with tangerine and it comes up right there as you can also see uh really easily on the dashboard it tracks your monthly cash flow so that's your Revenue your business expenses and also it can also track your net income so if that is your Revenue minus your business expenses which is great it can also track your monthly taxes which is really cool so it tracks your sales tax and your income tax estimate also it mentions if you need any help figuring out how this platform works you can check out all their free resources and they have a bunch of great articles there's also this button where you can book a meeting which is actually pretty cool so if you want to you know for example meet with bed ad uh you can do that you can book a meeting you know during these times and uh get to know the platform a bit better and of course here is where it keeps track of all of your business expenses and has it really easy to read graph so you can understand you know where is your money going it's going towards payroll and research and development expenses repair maintenance expenses and a bunch of other expenses as well now the one really cool feature that I kind of teased at during this video is their recommendations engine now for example if you were to use turfu you could actually hit saved you're like oh actually I do need a marketing agency now this would be considered an advertising and marketing business write-off so let's say I'm just going to save that for later awesome and then it'll put it in your library and so you can check back later be like oh right these were all the things that I want to use that I know are write-offs and there's also a little bit of a incentive whether that's like referral reward or discount another example and this would be for a travel write-off is this cheapest days to fly so I'm going to save that for later as well and you know we spoke about payment processing platforms and those fees well square is one option that you can use to process your payments and there is a little bit of an incentive it has free processing on a thousand dollars so I'm going to save that and that would fall into that write off that bank and payment processing write-off category also I talked about business loans and how you can write off that interest well if you were looking for a business loan you can actually use a BDC small business loans here and you can save that here and also you know I mentioned uh professional fees if you need a lawyer you can use good lawyer I mean there are just so many options and ideas for you uh to check out within the platform yourself and remember the base platform is absolutely free so remember I use Loom so that's there too and same with Microsoft Office I also pay for that gosh there's a lot of them that I use here actually so you can make an account try it out yourself take a look at some of these recommendations for write-offs and see some of their deals and you know start taking advantage and trying to lower your taxable income well I hope you found this video helpful but honestly I cannot stress this enough if you run your own small incorporated business like I do myself the best investment I ever made was accounting software my bookkeeper and my accountant so if you are running a Canadian Corporation and you need some help definitely check out reinvest wealth and also their new tax write-off recommendation engine you can find all that information and test it out yourself at reinvestwealth.com honestly it took me like two seconds to create an account and like I mentioned at the beginning of this video their base uh software for accounting is absolutely free so to cap things off if you have any questions uh because you know we talked about taxes and tax write-offs and I'm sure you have questions make sure to put them in the comments of this video I love comments guys I love them they give me inspiration for future videos so make sure to comment below if you haven't already make sure to subscribe to this Channel and hit that notification Bell so you can find out when I have a new video out uh but otherwise you know that's really it for me thank you so much for joining me for this video and I will see you next time