2016-12-30 00:00:00 Taxes English Learn how to report legal fees on Form T2125, Statement of Business and Professional activities. Review exceptions to the general reporting... https://d1bkf7psx818ah.cloudfront.net/wp-content/uploads/2017/03/08214455/Accountant-discusses-tax-financials-with-client.jpg Use T2125 to Deduct Legal Fees

Use T2125 to Deduct Legal Fees

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The Canada Revenue Agency allows small business owners and self-employed individuals to write off business expenses, and this includes legal fees. You may report legal fees on line 8860 of Form T2125, Statement of Business and Professional Activities.

These expenses may include legal fees incurred for advisement purposes, as well as legal fees paid to appeal assessments related to income tax, Canada Pension Plan contributions, and Employment Insurance premiums. In some cases, you must report legal fees on other parts of your T2125. For example, if you are a landlord and incur legal fees for drafting leases, you may report those costs on line 8860, as usual. However, if you incur legal fees while buying a property, you must include those fees as part of the cost of obtaining the property.

References & Resources

Information may be abridged and therefore incomplete. This document/information does not constitute, and should not be considered a substitute for, legal or financial advice. Each financial situation is different, the advice provided is intended to be general. Please contact your financial or legal advisors for information specific to your situation.

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