One mistake that many people make if they have moved in the past year says Edmonton bookkeeping. His thinking that all of their moving expenses can be claimed.
If people are able to meet the requirements set out by the Canada revenue agency. As to what makes moving expenses claimable. Most of the expenses they incur can in fact be claimed. To a maximum amount.
However, many people are not aware of these requirements. And they do not meet these requirements. Which means they cannot claim any of their moving expenses at all.
This is extremely important for people to know. So that they will be able to claim as many expenses as they can on their personal tax return. If they are aware of these requirements before they even move. They might even be able to ensure that they meet the requirements. So that they can claim these expenses.
The first requirement that the Canada revenue agency has laid out. Is that people must be moving a minimum of 40 km closer to their place of work. Many people interpret this as a total distance of 40 km from one home to the other. And that is not accurate. They need to ensure that it is forty distance to their work. In order to be able to claim their moving expenses.
The next requirement is that it must be a domestic move. From anywhere in Canada, to anywhere within Canada. Even if people are Canadian citizens. If they are moving back to Canada from a different country. This is not a claimable expense.
And finally, people need to ensure that they are not already getting reimbursed for their moving expenses. Whether it is the company that they are working for. Or if they are business owners. Their corporation cannot reimburse them for the moving expenses.
Once they have met all of these requirements. Canada’s revenue agency also requires people to have either sold their house. Or have provided documentation that they are trying to sell their home.
Once they have met these requirements. They can start claiming their moving expenses on their next personal tax return. Or, they can claimant on the next year. And they can strategize on which year is going to give them the best tax advantage.
However, it is important for people to note that there is also a maximum amount of moving expenses that they can claim. This is limited to the net income people are going to be earning. Therefore, if they have not earned a full year of income.
And they know they stand to make more income in the future year. It often is more advantageous for them not to claim their moving expenses yet. Or to claim some expenses in the current year. And the rest in the incoming year.
Because of how complex this can be. Anyone who is planning on claiming moving expenses. Can consult with their Edmonton bookkeeping company in order to come up with a strategy that makes the most sense for them tax-wise.
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Many people who are claiming the moving expenses they incurred on their personal taxes say Edmonton bookkeeping. Are not aware of all of the expenses that they are eligible to claim.
This is why, if people are planning on claiming their moving expenses on their taxes. They should contact an expert such as an Edmonton bookkeeping company. To help them understand what expenses they can utilize. To maximize the amount that they can claim.
One of the first things that people should keep in mind is to keep copies of all receipts. Because there might be some moving expenses that they do not think of at the time. By keeping copies of all their receipts. Their Edmonton bookkeeping company will be able to go through all of them. And be able to use all of the ones that are valid.
While many people think that all of the moving expenses that they can claim are limited to gas, meals, and accommodations during their traveling. There are many more expenses that they can utilize. To help them maximize the amounts.
For example, directly related to their travel expenses. People can claim things like increasing insurance on their vehicles for their journey. As well as fixing tires, getting oil changes. And having their mechanics tune up their vehicle.
If people have not been successful in selling their old residence. This can include the property taxes, utility bills as well as hiring someone to clean the house, or mobile lawn in their absence. So that it is presentable to potential buyers.
In fact, the cost of hiring a real estate broker meaning their commission after the sale. As well as legal and registration fees can also be claimed as a moving expense.
People can even claim incidental costs such as the connection fee that they have to pay when they set up the utilities in their new location. As well as the disconnection fee that they are going to incur when they stop utilities at their old residence.
People can even claim the cost of obtaining new documents. Such as a driver’s license, or provincial identification cards. That has their new address on them.
By keeping every single receipt that they incurred during the length of their move. Can help their Edmonton bookkeeping company figure out what expenses they can use. Because many people are unaware of all of the various expenses that they are eligible to use.
Even if they are going to utilize the simplified method as outlined by Canada revenue agency to claim a certain amount of money per person per day plus travel. Will require a person keeping all of their receipts. So that they can prove to Canada revenue agency if they get audited. That they incurred those expenses legitimately.
Anyone who is planning a move. Or have moved and are planning on claiming those expenses. Should hire Edmonton bookkeeping company. So that they can ensure they end up claiming is much as they can. To get the best tax benefit possible.