Phone and Internet Expenses
by Karen B
Only the business portion of your personal accounts is deductible.
Split phone line and internet expenses for home office
I am a sole owner who works from home and am set up with a single phone line with two numbers (one personal and one work), as well as internet charges.
From what I have read, these are not deductible under home office expenses, yet I use the second phone number exclusively for work and I use the internet primarily for work.
These bills, however, are in my personal name. Normally, when I have business expenses incurred out-of-pocket, I charge them back to the business (i.e. office supplies, etc.)
Can I do the same with my phone/internet expenses that apply to the business?
Many thanks for your help!
The good news is ... yes you can!Your business line is claimed on line 9220
of tax schedule T2125 ... but your personal line is not tax deductible
You can deduct a portion of your internet connection as well. You will need to find a reasonable method of estimating the personal portion to back out ... as it is not tax deductible. I would claim the business portion for your internet expenses on line 9220 as well ... or line 9270.
The general rule for claiming business expenses is ... it must be reasonable and made with the expectation of profit. All business expenses must be supported by original source documents
As far as I know, it is okay that they are in your personal name ... because you are a sole proprietor and you are your business
I do recommend that you limit purchasing business expenses with your personal funds. Learn why in my article on How to Create an Audit Trail
You may also like to read my Home Business Taxes
series found under "The Tax" button on the left hand side of the site.
I wish you much success in your business. :0)