Help - Worksheet for expenses and Ottawa accountant ???

[Calgarymom]

Ok now I have a question as well, do I have to do a breakdown of all my family expenses (food, bills etc) or if I have kept all receipts seperate can I just do a daycare one???

[Inspired by Reggio]

Ok now I have a question as well, do I have to do a breakdown of all my family expenses (food, bills etc) or if I have kept all receipts seperate can I just do a daycare one???

If you have managed to keep all your receipts for food and so forth separate than you would just use those for recording your expenses ~ it is advised that you need to keep your 'personal ones' on file as well should you get audited you would need to prove that what you have claimed was not 'shared expenses' by showing what you spent for your family portion.

There are going to be some things you need to do the 'shared expense' equation for unless your daycare is totally self contained and has it's own 'bills' just for that area .... mortgage interest and property tax, hydro, gas, home insurance, water heater or softener if you rent one for example are all shared expenses ~ you can only write off a portion of them dependent on the square footage of your home use, the number of hours you are open, and the days of the year you work.

Typically this works out for most providers to between 20 -40% max .... the higher % you are writing off the more of a red flag it is going to appear to CRA and put you at risk of being audited ... basically it has to be less than 50% because to use that % would mean you are using 100 % of your home for business, are working 365 days a year and are open 12 hours a day in order to come up with 50% shared expenses. Most of us do not use 100% of our home because we are not allowed to count 'closet space and non living space' so it might be 'close' to it but not 100%, and most of us only work a max of 240 days a year because we do not work weekends and take at least two weeks vacation a year and are closed for the 10 stat holidays, and most of us do not work 12 hours a day ... so all of those things 'lower' the % you can write off specific to your business model.