If you’re renting an apartment, you probably know that a portion of your apartment rent can be deducted from your taxes. However, you might not know that you can also deduct certain moving expenses from your next tax return, including transportation, packing and storage costs.
You Can Deduct Moving Expenses If …
To be able to claim moving expenses from your taxes, your move has to fit in one of the following categories:
· You moved to your new home or new apartment to start a job or a business, or to attend full-time post-secondary courses at a university, college or other educational institution.
· Your new place of residence is at least 40 kilometres closer to your workplace or school than your previous home.
· You moved from one place in Canada to another place in Canada.
Eligible Moving Expenses:
The Canada Revenue Agency allows you to deduct reasonable amounts that you paid for moving yourself, your family and your household effects, including:
· Transportation costs associated with moving from your old residence to your new one (e.g., gas, meals, and accommodation).
· Transportation and storage costs for your household effects (e.g., packing, hauling, storage and insurance).
· The cost of revising your legal documents and driver’s license to reflect the address change,
· The costs associated with disconnecting and switching over your utility hookups (e.g., cable, Internet, phone, hydro and gas).
· A maximum of 15 days’ living expenses near new or old residence (e.g., hotels and meals).
· The cost of cancelling your old lease.
· The cost of selling your old residence (including advertising, notary or legal fees, real estate commissions and mortgage penalties).
· If applicable, the costs associated with maintaining heat and power in a vacant old residence.
Expenses That Are Not Deductible:
Although the list above covers many of the costs associated with moving to a new apartment, there are many expenses that are not deductible (including some that are similar in nature to those that can be claimed). These include:
· A loss on the sale of your previous home.
· Expenses for work done to make your previous home more saleable.
· Transportation expenses for house-hunting trips before your move.
· Mail-forwarding costs.
· Expenses to replace items such as drapes, carpets and toolsheds.
Be sure to keep all of your receipts and documents supporting your claims – even if it’s not necessary to send them with your tax return, the CRA may want to see them at a later date.
Please keep in mind that the information presented in this article is very general and is subject to change, as tax laws are modified on a frequent basis. For specific details about which moving expenses you can claim, the maximum amount you can claim and the forms you will need to make your claim, be sure to check out the Canada Revenue Agency’s website or meet with a professional accountant.