Meals and Travel Expenses


(Canada)

When are meals in a restaurant a business deduction?

When are meals in a restaurant a business deduction?

Is there different treatment for the cost of meals in the following two scenarios?


1) Trying to make a sale, so I take the potential buyer out for a meal.

2) Travel to place of work and purchase meals along with hotel and car rental.



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Hello,

Sorry it has taken me so long to reply.

Your first scenario is an allowable business expense. When the amount is transferred to your tax return, only 50% will be deductible. You can read more here.

I think you are asking two separate questions in scenario two.

When going through a normal workday, your meals are NOT deductible nor are they considered a business expense. The logic is ... you have to eat anyway.

For example, if you were an employee in a business you did not own, the company would not provide you with free meals. If you were provided with free meals, they would generally be a taxable benefit ... with some exceptions.

If you travelled away from home on business (not pleasure) which required overnight stays in hotels, then your airfare, hotel and meals are a legitimate business expense. If you had to rent a car while there to conduct business, it is also a legimate business expense.

If you travelled to attend a convention related to business, the rules are a little different.






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