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A tax write off is an expense or amount you subtract so you pay less tax, and it never gives back everything you spent. On $80,000 of pay in Ontario, a $2,000 deduction saves $593.00 of tax, about 30 cents on the dollar.
Is a deduction the same as a credit?
No, and people mix them up because both get called a write off. A deduction shrinks the income you’re taxed on, so it saves tax at the rate on your top dollars. A credit skips that step and comes straight off the tax bill. On the federal side our credits calculator uses a simple rule: a credit saves 14% of the amount, and your province adds its own share.
Which one you have tells you which claim is worth chasing. The tax credits calculator puts both side by side, so you can see the effect before you dig out receipts.
| Type | What it reduces | Value of $2,000 at $80,000 pay in Ontario |
|---|---|---|
| Deduction | Income that is taxed | $593.00 of tax saved |
| Credit amount | Federal tax | $280 federal (14%), plus a provincial share |
Which tax write off can you actually use?
The Canada Revenue Agency sorts claims by life situation. Its most requested list includes medical expenses, moving expenses, the disability tax credit, the Canada training credit and home office expenses for employees. Other groups cover family and child care, education, pension and savings plans, and employment expenses.
Strictly speaking, not all of these are write offs. Moving costs and RRSP contributions are deductions. Medical costs and the disability amount are credits. Each comes with its own conditions, so read the CRA page on the item before you claim it.
Can you write off a home office as an employee?
Only with the detailed method. The flat rate shortcut from the pandemic years doesn’t apply to 2023 and later, so you’ll need a Form T2200 signed by your employer. You also have to meet the CRA conditions. One is working from home more than half the time for a stretch of four weeks in a row during the year. We’d check the other condition on the CRA page.
Keep the T2200 and your bills. The signed form is a requirement of the detailed method.
What does a self-employed designer save?
Say a self-employed worker in Ontario reports $60,000 after expenses. The income tax calculator gives $7,879.42 of income tax and $6,723.50 of CPP. Then another $6,000 of legitimate business costs turns up, such as software, supplies and a share of the phone bill.
Net income falls to $54,000. Income tax drops to $6,782.97 and CPP to $6,009.50. So the $6,000 of costs saves $1,096.45 of income tax and $714.00 of CPP, $1,810.45 in all. Real money, but you still spent $6,000 to get it.
The self-employed tax calculator adds instalments and the second tier of CPP. Business and rental earnings are taxed on net income, which is why your records matter.
Mistakes and limits
- Calling everything a write off. Personal spending isn’t deductible, even when it feels business related.
- Claiming without a receipt. The CRA can ask for proof.
- Expecting a big refund from a small credit. A $200 credit amount saves tens of dollars, not $200.
- Ignoring your marginal rate. Deductions are worth more at a high income, and the marginal tax rate calculator shows yours.
The figures here count the basic personal amount, the employment amount and credits for CPP and EI. Refundable credits and benefits aren’t counted.
Where the numbers come from
The list of claims and the home office rules come from Canada Revenue Agency pages on deductions, credits and home office expenses for employees, read in September 2026. Tax rates and CPP limits are the 2026 federal and Ontario figures used in our calculators. We’re not linked with the CRA or any government. If a claim is large or unusual, ask a tax professional before you file.
Frequently asked questions
Does a write off give back what I spent?
No. A deduction saves tax at your marginal rate. On $80,000 of pay in Ontario, a $2,000 deduction saves $593.00.
How do deductions and credits compare?
Deductions shrink the income you're taxed on. Credits come off the tax bill, at 14% of the amount on the federal side.
Can employees claim home office costs?
Yes, with the detailed method and a T2200 signed by the employer, if the work space conditions are met. The flat rate no longer applies.
What can a self-employed person write off?
The costs of earning business income. In our example, $6,000 of extra costs on $60,000 saves $1,096.45 of income tax and $714.00 of CPP.
Do I need receipts?
Yes. Keep receipts and records, since the CRA may ask to see them.
- How Canadian income tax works: brackets and credits
How federal and provincial Canadian income tax stack up, what marginal and average rates mean, and how credits and deductions change your bill
Information only. This page is general information, not tax, legal or accounting advice. Tax-Services.ca is an independent publisher: we don't prepare or file tax returns or offer tax services, and we have no connection with the CRA, Revenu Québec, any government or any company named on this page. Check the figures that matter with an official source or a qualified professional.