What is considered a meal and entertainment expense?
Meal and entertainment expenses are business expense categories that are tracked by bookkeepers and accountants. Generally speaking, any expense incurred while conducting business or entertaining a client or customer is considered an expense in these categories. This includes the cost of meals eaten out with clients or colleagues, tickets to events related to business activities, gifts given to customers or vendors
Entertainment expenses you can write off:
- Sporting events
- Bar tabs
- Runway shows
- Concert and event tickets
- Taxi rides
- Lift tickets
- Fishing tours
Entertainment expenses you can’t write off:
- Season tickets
- Recreational facility fees
- Greens fees
Meals and entertainment expenses according to the CRA
When it comes to meals and entertainment, the Canada Revenue Agency (CRA) requires that expense claims be reasonable and necessary in order for them to be deducted from taxable income. It is important to keep accurate records of all expenses incurred and retain receipts to support expense claims. Proper accounting practices are necessary to maximize expense deductions and maintain compliance with CRA regulations. When in doubt, it’s best to consult an experienced bookkeeper or accountant for help. By following the rules set out by the CRA, business owners can ensure their expense claims are valid and compliant.
Maintaining accurate books
Keeping accurate expense records is the key to minimizing tax liabilities and maximizing profits. By tracking these expenses carefully, business owners can be sure that their expense claims are valid and compliant with all applicable rules and regulations. Enjoying meals or drinks with clients or colleagues may have multiple benefits, however, it is important to stay within the expense limits set by the CRA in order to maximize expense deductions. Bookkeepers and accountants can help business owners make sense of expense claims related to meals and entertainment, so be sure to consult them whenever necessary. At the end of the day, tracking expense claims carefully will ensure that businesses remain compliant with all applicable regulations while maximizing their
If you’re thinking about hiring a bookkeeper for your small business, contact us at BBS Accounting CPA today. We would be happy to discuss your specific needs and how we can help you take your business to the next level.
