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While filing my taxes next year as a sole proprietor, I am considering claiming my Home Use of Business Office Expense (portion of my rent).
My challenge is that my roommate is on the apartment lease (I found this rental via kijiji a while back) & I just pay him via cheque. There's no receipt or any written agreement between us.
In this scenario, I am wondering:
- If I should claim my Home Use of Business Office Expense.
- If I do and get audited by CRA, how would I go about handling the audit.
Appreciate the insights, thank you.
To determine the amount that you can deduct in respect of rent paid in part for the use of a home office, follow these steps:
1. Multiply the rent + utilities paid by 50% (since you are responsible for only 1/2 of these costs).
2. Multiply the amount calculated in step 1 by the % that your home office space takes up the entire living space of the apartment. The resulting amount can be deducted from income.