I am going to an out-of-town work-related conference and will stay after the conference for vacation. What expenses can I deduct in my business for travel?
In order for travel expenses to be tax deductible they need to be incurred primarily for business. CRA does not want you to take a personal vacation and then deduct the relating expenses because you discussed business for one hour.
There are several factors to consider when determining which conference expenses can be deducted.
- The conference taken must relate to the company’s business. If the conference is taken primarily for personal knowledge or enjoyment, then any costs associated with it would not be deductible.
- Travel costs incurred to go to and from the location of the conference are only deductible if the primary purpose of the trip is to attend the conference.For example: You are going to New York for one week of personal vacation but then find out that there is a one day work-related event during the week you are there. Since your primary purpose of going to New York is personal, the travel costs are not deductible. You would still be able to deduct the cost of work-related event though such as the conference fees.
- If any part of the trip is personal, expenses that occur at the destination will need to be allocated between work-related and personal. This includes accommodation, food and other minor costs. For example: A doctor lives in Vancouver, BC, and is going to Hawaii for a medical conference for his business. The conference is five full days long and he plans on staying two extra days after the conference for vacation. He would not be in Hawaii if there was not a conference. Therefore, he can deduct in his business the full amount of the flight costs to and from Vancouver and Hawaii as well as the transportation costs to and from the airport and hotel as the conference is the primary reason for the trip. The accommodation, food and other costs relating to the conference would be deductible for the five days he attends the conference. For the two days after the conference, these costs would be considered personal and therefore, not deductible.
If you have questions which travel expenses you can deduct, please contact us for our help on this issue.Download a copy of this issue here