Income Tax Act s. 62, 248(1)
Line 219 Moving Expenses Deduction
If you moved at least 40km to be closer to a new job, to run a business, or to attend a post-secondary educational institute full time, then you may deduct moving expenses, up to the amount you earn at the new location, or up to the amount of award or scholarship income received in the year.
Normally, for the relocation to be an "eligible relocation", both the old and the new residence must be located in Canada, except in the case of a full-time student. However, a move between two locations outside of Canada can also be an "eligible relocation" if:
You may carry excess expenses forward to be offset from income earned at the new location in the next year. When both spouses have moved and subsequently earn income in the new location, the moving costs can be split between the spouses.
Many costs are deductible as moving expenses, including:
Note that if any moving costs have been reimbursed by your employer, then the moving costs must be reduced by the amount received, unless the reimbursed amount is included as income elsewhere on your tax return.
If an employer reimburses an employee for moving expenses re a transfer to a new work location, certain of these expense reimbursements will not be considered a taxable benefit to the employee, while some reimbursements will be considered a taxable benefit. When the employee has an eligible housing loss, only half of the amount exceeding $15,000 is taxable.
If the benefit to the employee is taxable, then CPP contributions and income tax must be deducted. If the taxable benefit is paid in cash, employment insurance (EI) premiums must be deducted. Non-cash benefits are not subject to EI.
For more information see Moving Expenses and Relocation Benefits on the Canada Revenue Agency (CRA) website.
Canada Revenue Agency Resources
Revised: April 23, 2016
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