Are conference expenses tax-deductible?

Conferences can be great places to generate ideas, learn about trends, network with other professionals, and promote your business. The Canada Revenue Agency (CRA) allows you to claim travel expenses as corporate deductions, but the agency has special rules for Conferences.

If you want to take advantage of the Conferences and maximize the payback potential, it’s important to understand the rules.

What is the cost of the agreement?

If you are an entrepreneur or self-employed, the CRA will allow you to amortize the cost of attending two conferences a year. The conference must apply to your business, and in most cases, the organizer must do business in the area where the events take place.

For example, if you are going to a conference hosted by a local electrical engineering union, you cannot request a waiver if the Conference is held in Hawaii.

A taxpayer who does business can deduct the costs of participating in 2 conferences per year if these agreements are:

1. It is held by a business or professional organization.
2. Related to the taxpayer business.
3. It takes place on-site according to the territorial scope of the promoting organization.

It is possible to fully deduct the conference expenses and all travel and accommodation expenses. The costs of food, drinks, and entertainment are limited to 50% of the amount paid. The CRA will certainly not accept expenses for a National Assembly held on an ocean liner. Even if the cruise has to travel between Canadian and American cities or 2 American cities, the Conference is considered to be held outside North America and is therefore not permitted.

Suitability for the Conference

In Canada, taxpayers can deduct eligible conference fees for up to two corporate deals per year. In order to leverage the tax deduction, the cost of the agreement must relate to an event that in some way affects your business or the professional activities you carry out.

Conferences sponsored by local organizers must take place in the geographic area in which the organizers operate. This geographic restriction does not apply to conferences sponsored by foreign organizers.

Tax deduction for the Conference

It is allowed to deduct the full price for participation in the conference. For example, if the Conference costs $ 300, you can write off the entire amount as a business expense. However, if the Conference fee includes food or entertainment, you can only deduct 50% of that portion of the fee.

For example, if the Conference costs $ 300 but includes free lunch and dinner, you should assume that the $ 50 fee is for the cost of the meal. In this case, you can deduct $ 250 from the Conference fee and $ 25 as a meal expense.

Travel by Conference

Travel expenses are also a deduction from the activity. When you go downhill, you can deduct the cost of public transport and hotel accommodation. Alternatively, if you drive your vehicle to the Conference, you may request a mileage-based deduction, or you can cancel part of the annual vehicle costs based on the time you use the vehicle for business purposes. When traveling for work, you can also charge additional costs, such as parking fees.

Expense tracking

When you are at a Conference, you want to focus on the event in front of you so that you are bothered by the filing of income and expenses for notes. However, if you forget to record an expense, you could lose valuable deductions. To make it simpler to track your expenses, consider using a receipt scanning application that allows you to scan your receipts and save them for your records.

Other catering/ food expenses

If the Conference offers only drinks or snacks, such as coffee and pastries, you do not need to indicate any rates as meals. However, since you have to eat at the conference, luckily, the CRA allows you to deduct these expenses.

You can deduct up to 50% of the cost of your food if the cost is reasonable. For example, if you spend $ 500 on a plate of food, which usually costs $ 30, you can only cancel $ 15 as a meal expense.

Conclusion

The territorial scope is defined in relation to the location of the body that organizes or sponsors the conference. If the organization has its operations only in Manitoba (for example, the Manitoba Association of Livestock Producers), the CRA would consider the national environment of the Manitoba Conference to be reasonable. If the sponsoring organization were national in scope, a conference venue would be appropriate anywhere in Canada. However, under the Canadian-US Tax Conference, the expenses of a Canadian resident or citizen who participates in Conferences held in the United States are treated as if they took place in Canada. This also includes seminars, meetings, and similar functions.