Maximize tax deductions on your 2025 personal taxes

So, it’s that time of the year.

I mean, it’s both from an excitement perspective—at least for accountants—and a little bit of trepidation. It’s the good and the bad that comes with personal tax season.

We’re just finishing up a variety of T-slip reporting. Next month will be trusts and partnerships, which take up a good chunk of bandwidth. And then of course, April is coming up quickly, where most of our resources are devoted to preparing personal tax returns. We’re starting to see the first groups of information come in—so thank you for that.

What I want to do today is go through some of the new things this year, along with some reminders in terms of our process for preparing returns and working with you.

Missed tax deductions: Watch for these

I’m going to start with some of the more common areas where we see missed deductions—or mistakes.

Carrying charges

First up is carrying charges. There are a handful of different types, and some of these may be deducted in your corporation, but often they should be personal. If you’re not sure, just jot a note down in your materials or your email when you submit your documents so the team can take a proper look.

Some of the common ones we see missed:

• Investment advisor fees (for non-registered funds)
• Interest expense

If the fees are inside an RRSP or TFSA, we can’t do anything with them. But non-registered funds—those are absolutely deductible.

A common example is a HELOC. A lot of people—especially real estate investors—are using a HELOC to invest, whether that’s in other real estate or other types of investments. Or it might just be a direct loan for investments. That interest is usually going to be deductible somewhere.

So again, flag it for us. In most cases, it’s going to be personal, but sometimes it may be corporate.

And if you’re using cash damming, make sure we’re capturing those deductions as well.

Meals and entertainment

Meals and entertainment is another one that comes up all the time. People often ask: “How much is too much?”

There’s nothing wrong with meals and entertainment expenses if they’re:

• Reasonable
• Related to earning income

Often these are corporate, but sometimes they’ll be personal. Where you need to be careful is how it looks.

For example, a February 14th dinner receipt. Even if it was a legitimate business meeting—and I’ve had them—an auditor might look at that and start asking more questions.

Same thing with birthdays, Mother’s Day, etc. Sometimes, if it’s a small amount, it’s just not worth the attention.

Real estate ownership: Partnership vs. joint

Owning real estate—this comes up at least once a year as an issue. Was it recorded as a partnership, or is it jointly owned? For those who have worked with me, you’ll know I rarely use partnerships. It’s almost always joint ownership—but not always.

And sometimes we find that it was recorded incorrectly for a few years. Usually it’s fixable, but it gets more complicated—especially in the year of disposition.

One of the reasons I don’t like partnerships in these situations is CCA. With a partnership, you have to use the same CCA across all partners. That might not be appropriate. So you could end up either wasting deductions or paying more tax than necessary.

Automobile expenses

Automobile expenses—no surprise—are something CRA looks at closely. If you have a corporation, we’re usually deducting these through the company. But that doesn’t mean the company owns the vehicle. Often, you personally own or lease the vehicle, and then charge the corporation for business kilometers.

Key things to track:

• Gas, maintenance, license fees
• Total kilometers driven
• Business-use kilometers

And make sure your numbers are reasonable. CRA will look at things like oil change receipts, which often include odometer readings. If your records don’t line up, you may have some explaining to do.

Also, commuting to work does not count as business kilometers.

CPP income sharing

It is possible to share CPP income. There’s a form for it, and in some cases it makes a difference—though often not a big one. If you’re not sure, ask.

Filing on time… or not?

Generally, we want to file on time. But not always. If we’re unsure about how to treat something—like whether a transaction is income or capital—it may be better to wait.

If you file one way and then change your mind later, CRA may question why your original position changed. It can look like retroactive tax planning. So sometimes we’ll hold off to get more clarity.

Other times, we may file with estimates—especially if we’re waiting on things like foreign income or co-venture numbers—and then amend later.

What’s new this year

There isn’t a lot that I would call “earth-shattering” this year, but a few things to note:

• The Underused Housing Tax (UHT) is now gone, but prior filing requirements still matter for 2022 to 2024 (penalties and interest are in place for those years)
• Donations timing may look a little different due to prior-year delays due to the postal strike, so make sure you don’t double count
• The digital news subscription credit is no longer available, but may still be able to claim digital news as a business expense
• Tax rates are slightly lower—but not dramatically

Canada Disability Benefit now available

The Canada Disability Benefit applications opened in June 2025, and is applicable to those 18 to 64 with disabilities. You can apply online. You can receive up to $2400 per year, inflation adjusted based on net income.

CPP reminder

CPP continues to increase. If you’re a business owner, remember you’re paying both the employer and employee portions. That can be close to $9,000 per year.

There are pros and cons, but in some cases, using a corporation and paying dividends instead may avoid CPP altogether.

Key deadlines

• April 10: Target date to get your information to us
• April 30: Filing and payment deadline for most individuals
• June 15: Filing deadline for self-employed individuals (payments still due April 30)

Important:
Having a corporation does not mean you’re self-employed for CRA purposes.

Preparation tips to maximize your tax deductions

Some practical things that make a big difference:

• Complete the tax checklists
• Total your expenses instead of sending raw receipts
• Include notes for anything unusual (address changes, new child, major transactions)
• Compare to last year—if something is missing, explain why

For investments, we often get incomplete data from financial institutions—especially missing cost base. If you don’t report gains properly, CRA may assume the full amount is taxable.

Foreign reporting

There is still a requirement to report foreign assets over $100,000 CAD. Penalties can be significant—up to $2,500. If you’re close to the threshold, it’s often safer to file.

Final thoughts

Maximizing tax deductions on your 2025 personal taxes isn’t about trying to “get away with something.”

It’s about:

• Making sure you’re capturing what’s available
• Being reasonable in how you claim things
• Giving your advisor complete and clear information

If you do those things, you’re going to be in a good position.

Thanks again for joining me, and have a great night.

And, if you want to just us for more Office Hours with George sessions, please register here.

Source: Office Hours with George webinar transcript