Travel from home to farm - deductible?

Tax Topics
1

I have a new client whose previous tax preparer allowed her to claim vehicle expenses based on kms driven to and from the farm (she does not live at the farm). This seems a lot like claiming your travel from home to work and back, which is not deductible. Is there a special provision to allow farmers to do this? Or is it just that the “office” is in her home, so it is considered travel from “head office” to another work location?

2

I’m not aware of any special rule for farmers (especially since most farmers live on the farm). Even if your client had a number of farms in different locations, CRA would only allow travel once they get to one of the farms at the start of the day.

3

I would think that the residence is the "“head” office ant the farm, rented farms if any are production centers. It’s also where correspondence is sent. If ever your client is audited, have the agent do his work in the barn. He may accept the residence as the base.

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4

Have you been in the offices of some of the newest dairy barns? I would take some of those over my own small basement office any day!

Travel from one farm to the next is obviously business travel. It would not be unlike a construction manager travel from one work site to another. You would have to use engineering type measurements, measuring to .0001 mm to determine which is allowable versus not allowable travel. How far is it from home to the farm? does she carry farm tools with her every day? How often does she stop at the vet’s office or the feed store or the equipment place to pick up parts? What percentage of her total travel is driving to the farm? There are many factors to consider.

5

This issue can be beaten to death. Commonsense, not abuses will prevail.

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6

Thanks - that’s what I wanted to know.

Anybody else have farm clients who claim vehicle expenses like this? To clarify, she lives in Regina, and the farm is 500 kms away. Needless to say, she doesn’t go there every day - just 5-10 times per year. If her “office” is in her home, in Regina, I think she could argue that she travelled from “head office” to the “work site”. Of course, I’ll explain to her that she may need to prove to CRA that it is reasonable, but she’s been claiming it for several years already, and is adamant that it should be claimed.

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7

Nice profitable farm hopefully. :slight_smile: