If someone has moved in the past year, they often believe that they can automatically claim those expenses says Edmonton bookkeeping. And while a lot of moving expenses can be claimed. Just because they have moved for work purposes. Does not necessarily mean that they qualify.
There are several different factors that must be satisfied. In order to be able to claim moving expenses on personal taxes. So even if a person has moved because of work. They still need to ensure that they meet all of these requirements set out by the Canada revenue agency.
For example, people need to be moving a minimum of 40 km closer to their work. Many people think that this means they must move at least 40 km in total. But it does need to be towards work.
They also need to ensure that they are moving from within Canada. And while it does not matter if there moving from within the same city, or interprovincial he. As long as they are moving domestically, that will satisfy the requirement.
They also need to ensure that they have sold their former residence. If they owned the home that they lived in. If they made a reasonable effort and was unable to do so. Canada’s revenue agency will allow them to claim those moving expenses. As long as they can provide documentation of that attempts to do so.
And finally, people can claim those moving expenses as long as they were not previously reimbursed. Which means their employer cannot reimburse them. And they cannot pay themselves back from their corporation if they are business owners.
Once they meet this requirement. Edmonton bookkeeping says that they have a maximum amount that they can claim based on their income. However, the Canada revenue agency allows people to carry forward those moving expenses to the following year.
What this means, is if a person does not have a full year of income. Either because they were unemployed, or they took time off for the move. It may be more beneficial to carry those moving expenses forward into the next year. When they will have a full year of income that they can claim against.
Even students who are moving because they are going to school can claim their moving expenses. And while they will not be earning an income. Their maximum amount will be related to if they are receiving government grants. And how much they are receiving.
This can be very complex issue. Not just figuring out if they can claim moving expenses. But how much they are going to be able to claim. Which is why if people have moved, and are planning on making that claim. They should hire and Edmonton bookkeeping company. So that they can have the help that they may need.
By utilizing an expert, people can ensure that they are claiming the maximum amount that they can. So that people can get the best benefit on their personal taxes that they possibly can.
What Are You Looking For?
The reason why people want to claim their moving expenses on their personal taxes says Edmonton bookkeeping. Is so that they can minimize the taxes that they ultimately owe at the end of the year.
This is because the average Canadian pays up to 43% of their entire income in a variety of taxes. While only 37% of what is left over goes towards their basic necessities.
The more expenses that people can claim on their personal taxes. And the more they are going to be able to minimize any taxes that they owe.
However, is a complex issue understanding what is considered a moving expense. And how much of that expense people can claim. It is why it is most beneficial for people to hire an expert and get an Edmonton bookkeeping company to help them understand this.
For example, most people know that they can claim meals, accommodation and the cost of fuel the incurred. While moving from one residence to the other.
However, there is a wide variety of other expenses that people may be able to claim. That they do not initially think of. For example, they are able to claim things such as the cost of new tires, insurance the need to purchase for the journey.
This is why it is very important for people to keep a copy of all of the receipts they incur during their entire move. And then letting their Edmonton bookkeeping company help them understand if that is the claimable expense or not.
If people are hiring a company to move their belongings. They might know that the cost of hauling their belongings as well as insurance can be claimed as a moving expense. But they may not realize that they can claim Packers to come in and pick up their belongings and move it onto the truck.
Or that they can claim for storage if when they get to their new home, they are not able to take possession for a couple days. And if they were not able to move directly into their home, and so they needed to stay in a hotel or motel for a couple of days. That temporary living expense can also be claimed.
With how complex this issue is, many people believe that using a simplified method, which is allowed by the Canada revenue agency. Will help them figure this out easier.
This simplified method includes able to claim seventeen dollars per person per day. As well as fifty-one dollars a day in meals. And claiming forty-eight point five cents per kilometer.
While using this simplified method can help ensure that people claim moving expenses on their personal taxes. However, they still need to ensure that they keep copies of their receipts. Because Canada revenue agency may ask them to prove that they did in fact incur those costs.
In order to help people claim moving expenses accurately on their personal taxes. Hiring and Edmonton bookkeeping company can help them claim as much as they possibly can. Without making mistakes that might cost them money.