There's a good article in this month's issue of "Canadian Living"
magazine about home-based Canadian businesses and tax deductions up
here.  To qualify as a legitimate business in Revenue Canada's eyes,
you must have a reasonable expectation of making a profit.  Rev. Cda
doesn't like to see a small amount of income used to write off
$thousands in expenses - they'll just decide your business is a hobby.
But the write-offs do include part of your mortgage or rent, mortgage
interest, insurance, municipal taxes and utilities.  To decide the
percentage of the above, you can use either the square footage of your
house or the number of rooms.  If your home office takes up one room
of a five-room home, you can write off one-fifth of the total costs.
Your home office must be your primary place of business or used
exclusively for regular meetings with clients.  Your dining room table
doesn't count.
Also included in tax deductions are expenses for your car, equipment,
meals, entertainment, professional fees and bank charges.
Interesting stat:  just under one million Canadians (excluding farmers)
work at home for pay, out of a population of about 28 million. A large
percentage, and growing fast.
Cheers,
PJ
Vancouver, BC
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