Taxpayers who moved in 2018 can take advantage of expense claims for lucrative tax breaks when filing their tax returns this year. However, there are some tricky rules that apply to eligible and ineligible moving expenses that must be considered in order to remain audit-proof with the CRA.
Components of this article were excerpted from Essential Tax Facts, 2019 edition.
Who qualifies to claim moving expenses? To qualify to claim moving expenses, a taxpayer must move at least 40 kilometres closer to the location where they earn income from employment or self-employment.
Students can often claim moving expenses to be in full time attendance at a post-secondary program at a university, college or other educational institution.
In addition, the taxpayer must stop working or operating a business at the old location, and establish a new home where they will reside with their family.
The following income sources earned at the new location will not be considered qualifying income for the purposes of claiming moving expenses:
Checklist of Allowable Moving Expenses
All receipts for the following allowable moving expenses claimed must be kept
Ineligible Moving Expenses:
The following expenses are not deductible:
Note: Students claiming moving expenses may be affected by the rules which exempt scholarship, bursary and fellowship income after 2006 when they are full-time students. Since moving expenses are limited to taxable income from employment, self-employment, or scholarships, it is possible that students with non-taxable scholarships will be unable to claim moving expenses.
Additional educational resources: for more tips on remaining audit-proof with the CRA at tax time, pick up a copy of Essential Tax Facts, 2019 edition by Evelyn Jacks. Pre-order by calling 1.866.953.4769 today, and receive your copy after they arrive in our office on April 24.
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