Every tax season, thousands of small business owners, real estate investors, and freelancers overpay their taxes or risk CRA/IRS issues simply because they’re unsure what’s actually deductible.
Here’s a clear breakdown of the most commonly Googled tax deductions, and how to approach each one with clarity and confidence.
1. Home Office Expenses
If you use part of your home for business, you may be able to deduct a portion of your rent, utilities, internet, and repairs. But it must be a dedicated workspace, not your kitchen table.
What you can do:
Measure the square footage of your office vs your full home. Apply that percentage to eligible expenses.
Common pitfall:
Claiming the entire internet bill or an undefined “office space” may get flagged.
Where Countwise Can Assist:
Help in choosing between simplified and detailed CRA/IRS methods, calculating accurate usage percentages, and defending the claim if reviewed.
2. Vehicle Use for Business
Driving to meet clients, deliver products, or attend events? Your mileage, fuel, insurance, and lease payments may be deductible if properly tracked.
What you can do:
Keep a log of your business-related trips. CRA requires a logbook; the IRS prefers mileage tracking apps like MileIQ or TripLog.
Common pitfall:
Forgetting to separate personal vs business mileage.
Where Countwise Can Assist:
Setting up mileage tracking, classifying vehicle expenses, and ensuring compliance with CRA and IRS rules.
3. Real Estate Investment Expenses
Rental income brings tax obligations but also allows for powerful deductions like mortgage interest, property taxes, management fees, repairs, and depreciation.
What you can do:
Track income and expenses per property. Classify repairs vs capital improvements accurately (e.g., fixing a faucet vs replacing a roof).
Common pitfall:
Not tracking expenses by property, or misclassifying renovations as repairs.
Where Countwise Can Assist:
Property-by-property reporting for T776 (Canada) or Schedule E (U.S.), capital vs current cost categorization, and audit-prep support.
4. Software, Subscriptions & Tools
Using Zoom, Canva, Dropbox, or QuickBooks? If they’re used for your business, they’re usually deductible.
What you can do:
Keep receipts and categorize tools by purpose: communication, design, bookkeeping, etc.
Common pitfall:
Claiming personal-use Netflix or Spotify as “business research.”
Where Countwise Can Assist:
Clean categorization, tracking recurring charges, and separating business vs personal tools.
5. Meals & Entertainment
Client lunches, business dinners, or travel meals can be deductible but only under certain rules.
What you can do:
Save itemized receipts. Note the purpose of the meeting and who attended.
Common pitfall:
Overclaiming. CRA and IRS only allow 50% of most meals to be deducted.
Where Countwise Can Assist:
Audit-safe tracking of meals and travel expenses across borders with proper documentation.
Final Word
Tax deductions are powerful, but only when claimed accurately. The difference between a well-organized return and a messy one can mean thousands saved or lost.
Countwise Financial works with small businesses and real estate investors across Canada and the U.S. to ensure that every eligible deduction is claimed properly, supported by documentation, and aligned with local tax laws.
Need help making sure you’re not leaving money on the table? Visit countwisefinancial.com or email hello@countwisefinancial.com to get started.