Tax - Entertainment Deductions - Calgarypuck Forums - The Unofficial Calgary Flames Fan Community

troutman · 02-07-2008, 02:25 PM

Is it true that if I operate a business, I can write off all my entertainment expenses?

There was a cranky letter to the Herald the other day suggesting it was improper for companies to write-off entertainment expenses (such as Calgary Flames season tickets). That didn't seem right to me. It certainly works as a great business tool for us.

Anyone here know the answer?

Locke · 02-07-2008, 02:35 PM

Yes, but only 50% is eligible.

Jason14h · 02-07-2008, 02:42 PM

As long as they are being used for prospective clients

troutman · 02-07-2008, 02:46 PM

Quote:

Originally Posted by Jason14h

As long as they are being used for prospective clients

At Death and Taxes Law Offices, you are all prospective clients.

Flames89 · 02-07-2008, 02:48 PM

I thought golf was not allowed anymore though ...

ken0042 · 02-07-2008, 02:51 PM

Seems right to me to be able to write off expenses. And it obviously works, because the last time I needed a lawyer, I called up my "buddy" as opposed to somebody else.

Cowperson · 02-07-2008, 02:53 PM

I had no problem surviving a CCRA audit where I was writing off Flames tickets. They even went to the extent of phoning a select, random number of clients/COI's I had been giving them to for verification.

What surprised them was I had almost zero golf write-offs. That's what floored them and got me strange looks.

Cowperson

troutman · 02-07-2008, 02:58 PM

Thanks for the info. The tickets work very well - I think we were able to help everyone we entertained at some point.

Like Cowperson, I hate golf, and golf hates me.

What about hiring a guide and taking clients fly-fishing on the Bow?

I-Hate-Hulse · 02-07-2008, 03:03 PM

Quote:

Originally Posted by troutman

Is it true that if I operate a business, I can write off all my entertainment expenses?

There was a cranky letter to the Herald the other day suggesting it was improper for companies to write-off entertainment expenses (such as Calgary Flames season tickets). That didn't seem right to me. It certainly works as a great business tool for us.

Anyone here know the answer?

http://www.ey.com/Global/assets.nsf/Canada/MYPT2008/$file/MYPT2008.pdf

Cost of tickets - 100% deductible.
Golf Green Fees - 0% deductible.
Golf Balls bought for a client - 100% deductible.
Client Meals / Beverages at games - 50% deductible. Track em seperately.

Following this - I would guess that a fly fishing trip is also deductible, but 50% of the meals....

There are differing rules around conventions and staff parties too.

Ole' cranky pants that wrote in to the Herald is probably just jealous as no one takes him to games in his/her vocation.

Flames89 · 02-07-2008, 03:04 PM

Quote:

Originally Posted by troutman

At Death and Taxes Law Offices, you are all prospective clients.

It is sentences like these that make me think I am in the wrong business. I bet you make a very comfortable amount and that you have a sweet work/life balance to boot ...

MoneyGuy · 02-07-2008, 03:09 PM

Food and entertainment are only 50% deductible. As a self-employed person who takes clients out, this pisses me off. Hear me out.

If I want to take my wife and, say, 12 top clients (including spouses, 14 people in total) out to a dinner theatre, for example, the bill could easily shoot over a grand for the night out; I'm including drinks. If you feel that I should not be able to deduct the cost for my wife and I (I do think I should be able to), then our cost is 14.3% of the total bill. Fine, be a jerk and make that non-dedictible, although I'd argue that the only reason we're there at all is to be with the clients. However, if the bill is $1200, I'm paying $600 out of my own pocket for something that is a legitimate business expense annoys me greatly.

That sucks!

troutman · 02-07-2008, 03:09 PM

Quote:

Originally Posted by Flames89

It is sentences like these that make me think I am in the wrong business. I bet you make a very comfortable amount and that you have a sweet work/life balance to boot ...

No, I should have been a dentist. Or player agent.

moon · 02-07-2008, 03:12 PM

Quote:

Originally Posted by MoneyGuy

Food and entertainment are only 50% deductible. As a self-employed person who takes clients out, this pisses me off. Hear me out.

If I want to take my wife and, say, 12 top clients (including spouses, 14 people in total) out to a dinner theatre, for example, the bill could easily shoot over a grand for the night out; I'm including drinks. If you feel that I should not be able to deduct the cost for my wife and I (I do think I should be able to), then our cost is 14.3% of the total bill. Fine, be a jerk and make that non-dedictible, although I'd argue that the only reason we're there at all is to be with the clients. However, if the bill is $1200, I'm paying $600 out of my own pocket for something that is a legitimate business expense annoys me greatly.

That sucks!

Personally I think you should be able to claim 0% of it, so at 50% with or without you and your wife included is a pretty good deal for you.

troutman · 02-07-2008, 03:16 PM

Here is a happy cooincidence for someone:

I have an extra ticket for tonight unexpectedly. First person to PM me, is welcome to be my guest (refereshments included).

Qwerty · 02-07-2008, 03:20 PM

Great offer! Someone take him up on that

edit - Was a shameless bump to make sure he doesn't go alone

I-Hate-Hulse · 02-07-2008, 03:20 PM

To be safe in case of audit, have a list of attendees on your trip, their contact details, and any subsequent invoices you may send them.

Azure · 02-07-2008, 03:23 PM

Quote:

Originally Posted by troutman

No, I should have been a dentist. Or player agent.

There is still hope....

Locke · 02-07-2008, 03:25 PM

Quote:

Originally Posted by troutman

Here is a happy cooincidence for someone:

I have an extra ticket for tonight unexpectedly. First person to PM me, is welcome to be my guest (refereshments included).

Damn, the one day I cant make it. Volunteering really saps a lot of my good time.

I'm going to make these kids pay for making me miss the hockey game!!

troutman · 02-07-2008, 03:41 PM

Quote:

Originally Posted by troutman

Here is a happy cooincidence for someone:

I have an extra ticket for tonight unexpectedly. First person to PM me, is welcome to be my guest (refereshments included).

Tickets were awarded. Thanks everyone.

ken0042 · 02-07-2008, 04:12 PM

Quote:

Originally Posted by MoneyGuy

However, if the bill is $1200, I'm paying $600 out of my own pocket for something that is a legitimate business expense annoys me greatly.

OK, somebody correct me if I'm wrong, but when you claim a business expense on your taxes, you don't get a tax credit of $600 back into your pocket, do you? I was sure that you paid taxes on $600 less of your income. So if the business made $100K that year, you only got taxed on $99,400 of it.

Or am I wrong?