March 5, 2019

Some unusual tax facts about income, deductions and credits

If you are unsure of what can be a tax credit or deduction, do your research or seek out some professional advice first before you act, or you might face consequences down the road. Illegal activity, medical expenses, employment expenses, pet maintenance and other expenses may or may not be deducted depending on what you are paying for or where you derive your earnings from. Real-life examples are discussed in detail to give you an idea of what you might be able to do come tax time.

Key Takeaways:

  • Canadians can claim eligible medical expenses incurred in any 12-month period that ends in the calendar year, which means you can pick the period with the highest amount of medical expenses provided they haven’t already been claimed.
  • Employees are permitted very few deductions other than certain costs they are required to pay for personally, which can be found on CRA’s Guide T4044
  • Gambling losses cannot be deducted if it is a hobby, but if it qualifies as a commercial activity, then winnings are taxable along with losses being deductible.

“Are you wondering whether that item you just purchased is deductible for tax purposes? Or whether an amount you received is taxable? There’s no shortage of stories to tell about taxpayers who got it wrong – or right, for that matter.”

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