Deductions When You Move for Employment, Self Employment Work or School
If you moved in 2015 for employment, self employment, or to attend a university or other post-secondary educational institution, you may claim a tax deduction for certain moving expenses if:
- Your new residence is at least 40 kilometres closer to your new employment, work place or educational institution than your former residence.
- You ceased your employment or self employment at your former worksite.
- Your move was within Canada, although there are certain exceptions to this rule.
You may claim mover’s transportation costs, storage charges, insurance, personal transportation costs for you and your family, the costs of cancelling a lease at your former living location, and lodging and meals for up to 15 days near your former or new living location. If you sold your former residence, you can claim the costs of selling that residence including advertising costs, legal fees, real estate sales commissions, mortgage prepayment penalties and various other costs. If you sold a property at your former living location and acquired a property at your new living location you can deduct certain costs of the purchase such as property transfer taxes in connection with the purchase of your new residence. (This does not include GST or HST.)
The costs of automobile and meals incurred in the move may be the actual costs (within reason and subject to certain limits) or the Canada Revenue Agency flat rate costs. For an automobile, it can be the actual operating costs for the year prorated over the total mileage for the year relative to the mileage for the move. Alternatively, it can be based on the 2015 flat rate in British Columbia of $0.485 per km. For meals it can be the actual costs or the 2015 flat rate of $17 per person per meal up to a maximum of $51 per person per day.
You must claim the deduction for eligible moving expenses in the year of the move up to the amount of your income from your new living location. If your deductible moving expenses exceed your income in the new living location, the surplus can be deducted in the following years. Deductible moving expenses to study as a full-time student at a university or other post-secondary educational institution can only be deducted against income earned in the year from scholarships, fellowships, bursaries, certain prizes, and research grants that are included in income for tax purposes.
If you move for employment purposes, you may not claim a deduction for any expenses paid by your employer on your behalf that were not included as a taxable benefit to you. Expenses you incurred that your employer reimbursed or expenses for which you have received an allowance are also not deductible unless the reimbursement or the allowance is included in calculating your income.
You should consult a Chartered Professional Accountant when considering a move to determine what costs are deductible.