Employment Expenses for Salaried Employees
You can deduct certain expenses you paid to earn employment income. You can do this only if your employment contract required you to pay the expenses, and either you did not receive an allowance for them, or the allowance you received is included in your income.
You kept a copy of Form T2200, Declaration of Conditions of Employment, completed and signed by your employer.
Note: Most employees cannot claim employment expenses. You cannot deduct the cost of travel to and from work, or other expenses, such as most tools and clothing.
You may be eligible to claim a deduction for employment expenses if you incurred any of the following expenses:
• Under your contract of employment, you had to pay for your expenses.
• You were normally required to work away from your employer's place of business.
• You were paid in whole or in part by commissions or similar amounts (based on the volume of sales made or the contracts negotiated).
• You did not receive a non-taxable allowance for traveling expenses. Generally, an allowance is non-taxable when it is based solely on a reasonable per-kilometer rate.
Types of expenses for Commission Employees:
Accounting and legal fees
You can deduct legal fees you paid in the year to collect or establish a right to collect any amount that, if received, you would include as employment income on your return. However, you have to reduce your claim by any amount awarded to you, or any reimbursement you received to cover your legal expenses.
You can deduct office rent you paid to earn your commission income. Do not confuse office rent with work-space-in-the-home expenses
You can deduct parking costs related to earning your commission income. Generally, you cannot deduct the cost of parking at your employer's office, such as monthly or daily parking fees. These are personal costs.
Salaries for an assistant
You can deduct the salary you paid to your substitute or assistant. Note: You may have to withhold income tax, Canada Pension Plan (CPP) or Quebec Pension Plan (QPP) contributions, Employment Insurance (EI), and Provincial Parental Insurance Plan (PPIP) premiums from the salary you paid. Report, on a T4 slip, the salary, and amounts you withheld. For more information, see Employers' Guide - Filing the T4 Slip and Summary. As the employer, you can also deduct as an expense your share of the CPP or QPP contributions and the EI and PPIP premiums.
Supplies (Including teaching supplies purchased by teachers)
You can deduct the cost of supplies. Supplies are only those materials you use directly in your work and for no other purpose. Supplies include items such as pens, pencils, paper clips, stationery, stamps, street maps, and directories. Supplies do not include items such as briefcases or calculators. You can deduct expenses you paid for telegrams and long-distance telephone calls that reasonably relate to the earning of commission income. However, you cannot deduct the monthly basic rate for your home telephone. You cannot deduct the cost of special clothing you wear or have to wear for your work. Generally, you cannot deduct the cost of any tools that are considered to be equipment. However, if you are a tradesperson (including an apprentice mechanic), you may be able to deduct the cost of eligible tools you bought to earn employment income as a tradesperson.
You can deduct expenses you paid for the employment use of a workspace in your home, as long as you meet one of the following conditions:
• The workspace is where you mainly (more than 50% of the time) do your work;
• You use the workspace only to earn your employment income and on a regular and continuous basis for meeting clients or customers.
• You can deduct the part of your costs that relates to your workspace, such as the cost of electricity, heating, maintenance, property taxes, and home insurance. However, you cannot deduct mortgage interest or capital cost allowance.