With income tax time just around the corner, the federal government has announced that tradespeople can continue to deduct from their income part of the cost of tools purchased throughout the year.
The cost includes any GST and provincial sales tax, or HST.
An eligible tool is a tool (including associated equipment such as a toolbox) that:
- you bought to use in your job as a tradesperson and was not used for any purpose before you bought it;
- your employer certified as being necessary for you to provide as a condition of, and for use in, your job as a tradesperson; and
- is not an electronic communication device (like a cell phone) or electronic data processing equipment (unless the device or equipment can be used only for the purpose of measuring, locating, or calculating).
The employer must complete and sign Form T2200, Declaration of Conditions of Employment for the tradesperson.
If you were a tradesperson in 2012, click here for the formula to calculate your maximum tradesperson’s tools deduction.
The claim can be entered on the “tradesperson’s tools expenses line” (1770) of Form T777, Statement of Employment Expenses.