A discussion of expenses is beyond the scope of this document. The CRA provides some limited guidance, including at webpage Business expenses - Canada.ca and in Guide T4002.
If a person does not have a GST/HST account, expenses claimed on the T2125 can include HST.
Some general guidance for common expenses:
Motor Vehicle Expenses: It is recommended to keep a logbook recording the odometer reading at the start and end of the year, and for each business-related trip: the date, destination, purpose, and distance traveled. Keep receipts or records for fuel, insurance, lease payments, and maintenance. Mobile apps can help track this information, and some tax software can integrate data from these apps directly. The CRA could send a review letter requesting the logbook. Here is an excerpt from an actual review letter:[1]
Cell Phone or Internet Charges: Retain receipts and records of payments, determine the percentage of use for business purposes, and be prepared to explain and justify the calculation.
Where it's unclear if an expense is allowed, general principles of analysis can be found in the Supreme Court of Canada’s Symes case.[2]
[1] This image was acquired from a 2026 Reddit post.
