Can I write-off my computer as a business expense if I paid for it personally?

Question

I need a new computer, and am going to buy a laptop at some point in the near future. I believe it is appropriate to write this off 100% as a business expense, since the computer will primarily be used in support of business purposes.

Is it okay to purchase the computer using my personal credit card (as I don’t have a business one), and then reimburse my personal account directly from my corporate account in the amount paid for the computer?

Answer

Yes, you can purchase the computer using your personal credit card, and then have your corporation reimburse you for the cost.  While the computer may be used primarily for business purposes, the corporation can not write-off the entire purchase amount in a single year.  Rather, the cost of the computer is depreciated (CCA) at a rate of 55% per year. For more eligible write-offs check out tax write-offs for a small business in Canada.

ABOUT THE AUTHOR

ALLAN MADAN

CA.CPA.CGA

Allan Madan is a CPA, CA and the founder of Madan Chartered Accountant Professional Corporation. Allan provides valuable tax planning, accounting and income tax preparation services in the Greater Toronto Area.

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