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How to Take Dog Tax Deductions in Canada

If your dog works with you, you may be able to claim a tax deduction for certain expenses. Generally, if you’re a rancher or farmer using dogs for herding or guarding livestock, the Canada Revenue Agency (CRA) allows you to write off your cost of buying, training, and feeding your dogs.

In 2002, a farmer took his claim for cat and dog food to the Tax Court of Canada. The court ruled the deduction was allowable because the animals were guarding his blueberries. This ruling hinges on the fact that the farmer was growing blueberries for business purposes.

When Are Pet Expenses Tax Deductible?

You can’t claim deductions for a pet dog, regardless of the plants he guards. In most cases, dog-related expenses aren’t deductible, even if your dog is your favourite sidekick on the job.

But there are certain circumstances in which your animal expenses are deductible. If you have a service animal, you may have allowable deductions for your animal-related expenses. These deductions are treated as medical expenses, not business expenses.

Imagine you own a salon and have a service dog for your epilepsy. Even though you bring your dog to work every day, that doesn’t automatically mean the expenses are deductible from a business standpoint. However, you can report your service dog costs as medical expenses, just as you would treat medications you take during work.

If you incur dog-related expenses as part of running a business, you can usually claim those costs as business expenses. This most often affects ranchers and farmers, but could also include dog groomers, pet sitters, and similar professionals.

Your dog is your best friend, but might also be a source of tax deductions in Canada. Tracking your spending ensures you don’t miss an expense. QuickBooks Online can help you maximize your deductions. Keep more of what you earn today.

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