Deducting Legal, Accounting and Other Professional Fees

Many startups do not realize that their legal and accounting fees can be deducted as a business expense for tax purpose. Here is the CRA’s full archived guide to deducing legal and accounting fees.

The CRA’s breif summary guide states:

Deduct the fees you incurred for external professional advice or services, including consulting fees.

You can deduct accounting and legal fees you incur to get advice and help with keeping your records. You can also deduct fees you incur for preparing and filing your income tax and GST/HST returns.

You cannot deduct legal and other fees you incur to buy a capital property. Instead, add these fees to the cost of the property.

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John Wires is a Toronto business lawyer who comes from a corporate litigation background. John is the founder of Wires Law, a law firm serving corporate, technology and e-commerce clients across Canada. He was called to the Bar of the Law Society of Upper Canada in 2011 and has appeared in the Ontario Superior Court, the Ontario Court of Appeal and private arbitrations. John graduated from law school with first class honours specializing in both International Trade and Corporate Commercial Law. Having litigated shareholder and employee disputes he understands the value of companies protecting their businesses with the proper upfront legal work many Canadian businesses lack.