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How much can be deducted from a professional development seminar for a small business?

By CO Staff |

Alex asked:

How much can be deducted from a professional development seminar for a small business (1 person company/consultant)?

What is the % for the seminar cost, airplane, hotel, etc.?

CO Staff answered:

We contacted the CRA in order to field this question, and the best answer is that a professional development seminar is probably a deductable business expense. It really depends on the nature of the seminar and where it is held.

If you run a legitimate business in Canada and are seeking to attend a seminar that will further your ability to earn money and operate your business, than it is likely that the event is deductable.

Guide T4002, available on the CRA website, states that you can deduct the cost of going to a maximum of two conventions a year. However, the conventions must:

  • relate to your business or professional activity; and
  • be held by a business or professional organization within the geographical area where the organization normally conducts its business.

The second limitation may not apply if an organization from another country sponsors the event and it relates to your business or professional activity.

In terms of food, beverage and entertainment costs, Guide T4002 states:

"Sometimes, convention fees include the cost of food, beverages, or entertainment. However, the convention organizer may not show these amounts separately on your bill. If this is the case, subtract $50 from the total convention fee for each day the organizer provides food, beverages, or entertainment. You can deduct this daily $50 amount as a meal and entertainment expense. However, the 50% limit applies to the daily $50 amount." (Does not include incidental items like coffee or doughnuts available at convention meetings and receptions).

Transportation costs can be claimed from your place of business to the convention or business destination and back, but only by the most direct route available. And there are geographical limitations to this general rule: claiming expenses to go to a conference in Hawaii when a similar one is available in your city will not be looked on favourably by the CRA.

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