Self-Employed Tax Deductions in Québec: The Complete 2026 List

If you are self-employed in Québec, every legitimate business expense you deduct lowers three bills at once: federal income tax, Québec income tax and your QPP contributions. You claim the same expenses twice, on the federal T2125 and the Québec TP-80, and the two governments mostly agree. Where they don’t (home office, meals, professional dues, health insurance), the difference can be worth hundreds of dollars. This guide lists every common category with the 2026 rules and limits, a full table, a worked example and the records you need to keep.

This guide is for sole proprietors, freelancers and partners. If you want the full picture of how self-employed people are taxed, read our guide to self-employed tax in Québec (T2125 and TP-80).

What can self-employed people deduct in Québec?

The general rule is the same federally and in Québec. An expense is deductible when it is:

• Incurred to earn business income, not for personal reasons.
• Reasonable in amount for what you get.
• Not capital: things that last more than a year (a computer, a car, furniture) are deducted over time through capital cost allowance (CCA), sometimes all in the first year.
• Not specifically denied by the tax law (fines, club dues, most life insurance).
• Supported by a record: a receipt or invoice, plus a log for vehicle use.

When an expense is partly personal (your phone, your car, your home), you deduct only the business part, using a reasonable method you can explain.

Self-employed deductions in Québec: the complete 2026 table

Vehicle ceilings are the 2026 amounts announced by Finance Canada on January 14, 2026 and confirmed by Revenu Québec on February 6, 2026.

Can I deduct my home office as a self-employed person in Québec?

Yes, if the space meets one of two conditions:

1. It is your principal place of business (most freelancers who work from home qualify), or
2. You use it only to earn business income and regularly and continuously to meet clients, customers or patients.

What counts and how to calculate it

• Tenants: rent, electricity, heating, home insurance and maintenance.
• Owners: mortgage interest (not principal), municipal and school taxes, electricity, heating, insurance, maintenance and, optionally, CCA on the building. If you claim CCA on your home, the capital gain and recapture rules apply to the business part when you sell, so we rarely recommend it.
• Calculation: office area divided by the home’s total finished area, applied to the shared costs. Costs that relate only to the office, such as painting it, are deductible in full. If the room is also used personally, reduce the claim by hours of business use.

Québec’s 50% rule

This is the biggest Québec difference. Under section 175.5 of Québec’s Taxation Act, you can deduct only 50% of the business share of the costs of maintaining the home: rent, mortgage interest, property and school taxes, insurance, maintenance and repairs, and CCA. Electricity and heating are not subject to the 50% limit, nor are expenses that relate only to the workspace. The federal return has no such limit. The same 50% restriction applies to the QST input tax refunds on those costs if you are registered.

The loss rule

On both returns, home office expenses can’t create or increase a business loss. You deduct them up to your business income after other expenses; the unused part carries forward to next year, as long as you still qualify.

Example: your office is 12% of a rented apartment. Rent is $22,800 a year, electricity (including heating) $1,500 and tenant insurance $420. Federally you deduct 12% of everything: $2,966. In Québec you deduct 12% of rent and insurance at 50% ($1,368 + $25) plus 12% of electricity in full ($180): $1,573.

What vehicle expenses can I deduct, and what are the 2026 limits?

You deduct the business-use share of your total vehicle costs: fuel, insurance, maintenance and repairs, tires, registration and driver’s licence, car washes, loan interest or lease payments, and CCA. The share comes from your logbook: business kilometres divided by total kilometres.

The logbook

For each business trip, note the date, destination, purpose and kilometres, plus your odometer at the start and end of the year. After one full year of logging (your base year), the CRA accepts a three-month sample log in later years, as long as business use stays within 10% of the base-year results. Trips from home to a regular workplace are personal; if your home is your principal place of business, trips from home to clients and suppliers are business.

2026 automobile limits

The per-kilometre rates are what an employer can pay an employee tax-free. As a self-employed person you can’t simply multiply your business kilometres by 73¢; you deduct your actual costs times your business-use percentage. Pick-up trucks and vans used mainly for business can fall outside the “passenger vehicle” definition and the ceilings; check before you buy.

CCA on a vehicle bought in 2026

A car is Class 10 (30%), or Class 10.1 if it costs more than $39,000. Property acquired after 2024 and available for use before 2030 gets the accelerated investment incentive: generally 45% of the cost in the first year instead of 15%. Zero-emission vehicles in Class 54 can be written off 100% in the first year, up to the $61,000 ceiling. A car bought on or after September 15, 2026 may qualify for a proposed 100% write-off only if it was assembled in Canada and never used before (see the CCA section below).

Are meals and entertainment deductible in Québec?

Generally 50%, and Québec limits them further.

• Federal and Québec, 50%: you deduct 50% of the lesser of what you spent and a reasonable amount, including taxes and tips. This covers client meals, drinks, show and game tickets, and meals while travelling for business.
• Exceptions at 100%: meals you bill to a client and show on the invoice, events for all your employees at a location (up to six a year), and fundraisers mainly for a registered charity. Long-haul truck drivers deduct 80% of meals on eligible trips.
• Québec’s ceiling: after the 50% cut, the Québec deduction can’t exceed a ceiling based on your sales for the year.

Example: sales of $85,000 and $2,800 of client meals. Federally you deduct $1,400 (50%). In Québec the ceiling is $1,062.50 (1.25% × $85,000), so you deduct $1,062.50. Québec also allows subscriptions to qualifying cultural shows in Québec (at least three performances) in full, outside the ceiling.

On every meal receipt, write the client’s name and the business reason. A receipt alone doesn’t prove a business purpose.

Can I deduct my phone, internet and software?

• Cellphone: the business share of your plan and airtime. A phone used 60% for business means 60% of the bill. The phone itself is equipment (CCA) unless it costs under $500.
• Internet: the business share of your home internet. Keep a short note of how you estimated it.
• Home landline: the basic monthly rate isn’t deductible; long-distance business calls and a separate business line are.
• Software and subscriptions: monthly or annual services (accounting software, design tools, cloud storage, website hosting) are regular expenses. Application software you buy outright is Class 12, deductible in full.

How do equipment write-offs (CCA) work in 2026?

Equipment that lasts more than a year is deducted through capital cost allowance. Three sets of rules matter for 2026, and their legal status differs.

• Accelerated investment incentive (law): reinstated by Bill C-15, which received royal assent on March 26, 2026. For eligible property acquired on or after January 1, 2025 and available for use before 2030, the first-year deduction is generally three times the normal amount for property subject to the half-year rule. It phases out from 2030 and ends after 2033. Québec’s March 2026 budget documents show the same accelerated first-year allowance (150% of the usual first-year CCA) applying in Québec for property acquired since January 1, 2025.
• Immediate expensing of computers (law): 100% in the first year for Class 50 (and Classes 44 and 46) acquired after April 15, 2024 and available for use before 2027, also enacted by Bill C-15. Québec announced in May 2024 that it would harmonize with this measure. Buy and start using the computer by December 31, 2026 to be safe.
• Productivity Mega Deduction (proposed): announced September 15, 2026 with draft legislation, it would allow a 100% first-year deduction for most depreciable property acquired on or after September 15, 2026. Individuals can claim it, but it can’t create or increase a business loss. Buildings, goodwill-type intangibles and most passenger vehicles not assembled in Canada are excluded. The federal budget of November 5, 2026 confirmed the government’s intention to proceed, but it was not yet law when this guide was updated. As of early November 2026, Québec’s Finance Ministry had not decided whether to harmonize, so your Québec CCA could differ. Treat it as a proposal, not a certainty.

CCA is optional: you can claim less than the maximum in a low-income year and keep the balance for later years.

Other deductible expenses for self-employed people

• Advertising and marketing: ads, website, design, printing, sponsorships with a real advertising benefit.
• Professional fees: accounting, bookkeeping and legal advice for the business, including the preparation of your business statements. Legal fees to buy equipment or property are added to its cost.
• Insurance: professional liability, business property and commercial vehicle insurance. Life insurance premiums are generally not deductible.
• Training and conventions: courses that maintain or upgrade skills you already use in the business, and up to two conventions a year held by a business or professional organization. A degree that qualifies you for a new profession is not a business expense (it may give a tuition credit instead).
• Travel: transport, hotels and 50% of meals for business trips. The personal days of a mixed trip are not deductible.
• Supplies, rent, bank fees and interest: materials you use up, an office or coworking membership, account and card-processing fees (Stripe, Square, PayPal), and interest on business loans and lines of credit are deductible in full.
• Salaries to family members: deductible when the work is real and necessary, you actually pay it, and the pay is what you would pay a stranger. You run payroll, withhold source deductions and issue T4 and RL-1 slips. See our payroll service.
• QPP and QPIP on your own earnings: you pay both the employee and employer shares of QPP. The employer-equivalent share of base QPP, all enhanced contributions and the employer-equivalent share of QPIP are deducted on the return (not on the T2125 or TP-80); the rest gives a federal credit. Our self-employed tax guide shows the amounts.

What is not deductible for the self-employed?

• Personal living costs: groceries, your own lunches, personal phone use, vacations.
• Commuting from home to a regular place of work.
• Everyday clothing, even if you wear it only for work, and grooming. Protective gear and uniforms with your logo are different.
• Fines and penalties, including parking and speeding tickets, and interest and penalties on your own income tax.
• Income tax and your own draws or “salary” as a sole proprietor.
• Club membership dues for dining, sports or recreation (golf clubs, private clubs).
• Life insurance, in most cases.
• The value of your own labour, for example on renovating your office.
• Capital purchases deducted in full when they should go through CCA.
• Costs incurred before the business actually started, generally.
• RRSP contributions: deductible, but as a personal deduction, not a business expense.

Can I claim the GST and QST on my expenses?

If you are registered for GST and QST (mandatory once your taxable sales exceed $30,000 over four calendar quarters), you recover the GST (input tax credit) and QST (input tax refund) paid on business expenses, in the same business-use proportion as the expense. You then deduct the expense net of the taxes you recover. A few rules mirror the income tax limits:

• Meals and entertainment: only 50% of the GST and QST is recoverable, and the QST refund is also limited by Québec’s sales-based ceiling.
• Home office: the 50% Québec restriction on home maintenance costs also applies to the QST refund.
• Passenger vehicles: credits are generally limited to the tax on the capped cost.
• Not registered? You can’t recover the taxes; they simply become part of the deductible expense.

Your supplier’s invoice must show the right information (for purchases of $100 or more, its GST and QST numbers). Our GST/QST guide explains registration, the quick method and filing.

Worked example: home office, vehicle and meals for a Montréal designer

A self-employed graphic designer in Montréal, registered for GST/QST, has 2026 sales of $85,000. Amounts are net of recoverable GST and QST, except the car, where we ignore credits to keep it simple.

• Office: 12% of a rented apartment (rent $22,800, electricity $1,500, insurance $420).
• Car: used car bought in March 2026 for $24,000 (Class 10). 16,000 km driven, 6,400 for business (40%). Fuel $2,400, insurance $1,300, maintenance $800, registration and licence $500, loan interest $1,000.
• Client meals: $2,800.
• Other: software $1,200, 60% of a $960 phone bill, 40% of $900 of internet, a $3,000 computer bought in June, accounting $800, advertising $1,500, insurance $600, bank fees $240.

Three lessons: the Québec return almost always shows a higher net income than the federal one for a home-based business; the vehicle logbook is worth about $6,700 of deductions here, so it is worth keeping; and the 2026 computer purchase is fully written off because it was in use before 2027. These are illustrative figures; your own result depends on your facts.

What records do you need to keep?

• Receipts and invoices for every expense, paper or digital, with GST/QST numbers where required.
• A vehicle logbook (full year, or base year plus a three-month sample) and odometer readings at January 1 and December 31.
• Your home office measurements and the bills for the shared costs.
• Notes on meal receipts: who and why.
• Bank and credit card statements, and a separate business account if you can.
• Payroll records for any family member you pay.

Keep everything for at least six years after the end of the tax year it relates to. Both the CRA and Revenu Québec can ask for it.

How we help

We prepare self-employed returns for Québec residents, with both business statements, and a tax professional reviews every return. We keep your books through the year so the deductions are already sorted when tax season arrives: see our self-employed tax returns, personal returns from $300, and bookkeeping plans from $350 a month. Planning ahead? Read our year-end tax planning checklist, see whether it is time to incorporate, or set up your books with our QuickBooks setup guide. Questions about a specific expense? Contact us.

Frequently asked questions

Sources

• CRA – T4002, Chapter 3: Expenses (2025 guide, modified April 16, 2026)
• CRA – Business-use-of-home expenses
• CRA – Classes of depreciable property
• CRA – Line 22200: deduction for CPP or QPP contributions on self-employment income
• Finance Canada – 2026 automobile deduction limits and expense benefit rates (January 14, 2026)
• Revenu Québec – Limits and rates related to the use of an automobile for 2026 (February 6, 2026)
• Revenu Québec – Meal and entertainment expenses (operating expenses)
• Revenu Québec – Dépenses d’exploitation (travailleur autonome)
• Revenu Québec – Dépenses liées à l’utilisation du domicile (membre d’une société de personnes)
• Revenu Québec – Interpretation letter 22-058993-001 on section 175.5 (home office 50% limit), 2022
• Revenu Québec – Interpretation letter 03-0109003 on home office QST refunds and the 50% limit, 2003
• Revenu Québec – Preparing invoices (GST/QST)
• Raymond Chabot Grant Thornton – Tax planning guide: general business expenses
• Raymond Chabot Grant Thornton – Planiguide : dépenses générales d’entreprise
• Raymond Chabot Grant Thornton – Bulletin fiscal, Budget du Québec 2026 (March 18, 2026)
• PwC Canada – Bill C-15 implements SR&ED, CCA and other changes
• EY – Canada’s 2025 budget implementation bill No. 1 receives royal assent (March 30, 2026)
• Gouvernement du Québec – Harmonization with the April 16, 2024 federal budget (May 31, 2024)
• Finance Canada – Government of Canada introduces new Productivity Mega Deduction (September 15, 2026)
• Osler – Canadian Prime Minister announces Productivity Mega Deduction (September 15, 2026)
• RBC Wealth Management – Federal budget 2026: overview of key measures (November 5, 2026)
• Noovo Info – « Mégadéduction » : Québec has not decided whether to harmonize (November 6, 2026)
• PwC Canada – Corporate tax rates and legislation, Q3 2026 accounting status

Keep reading

• Self-Employed Tax in Québec (2026): Rates, Deadlines, T2125, TP-80
• GST/QST for Québec Small Businesses (2026): How It Works
• How to pay less tax in Québec: 2026 year-end tax planning checklist
• Should you incorporate your business in Québec? (2026 guide)
• How to Set Up QuickBooks Online for a Québec Business (2026 Guide)
• Salary or dividends in Québec (2026): how to pay yourself