For most employees, the cost of getting to and from work is not tax-deductible.
Some employees, however, may be entitled to tax relief for their commuting
costs, if they meet certain conditions.
Under the Tax Act, employees can deduct amounts personally paid for travel if
they are "ordinarily required to carry on the duties of the office or employment
away from the employer's place of business or in different places" and their
employer does not reimburse them for those expenses.
The Canada Revenue Agency has defined several of the above terms. It defines
"ordinarily" as customarily or habitually, rather than continually, but suggest
that there should be some degree of regularity in the traveling required.
"Required" means that the travelling is necessary for the employee to properly
perform his or her employment duties. "Place of business" refers to a permanent
place of employment such as an office, factory, warehouse ... or perhaps even a
Last month, the Tax Court of Canada had to decide whether former CFL
quarterback Oteman Sampson was entitled to deduct certain travelling expenses
when he played for the Calgary Stampeders and the Toronto Argonauts in 2000.
During that year, Mr. Sampson was a resident of the United States but lived
in hotels and apartments while playing in Canada. Under his contracts of
employment with the Stampeders and Argonauts, he was fully reimbursed for travel
expenses he incurred for games away from his home club cities but otherwise was
required to pay his own expenses personally.
On his 2000 tax return, Mr. Sampson deducted approximately $14,000 of travel
expenses for hotels, apartments, meals and other living expenses in Calgary and
Mr. Sampson argued that since he had a permanent home in the United States
while working "temporarily" in Canada, he should be allowed to deduct the living
expenses incurred in Canada as reasonable travel expenses incurred in the course
The Tax Court judge disagreed, finding that a deduction is permitted only for
travel expenses incurred by an employee in travelling to a place of work away
from the usual place of employment. According to the judge, "the living expenses
at issue were incurred in the cities where the employment was usually exercised.
[Mr. Sampson's] ordinary place of work was Toronto when he was employed by the
Toronto Argonauts and it was Calgary when he was employed by the Calgary
Stampeders." Accordingly, he was not able to take advantage of the tax
Employees should also keep in mind that any amounts deducted for travelling
expenses should be reasonable and must be directly related to their employment.
In another football-related Tax Court case decided last year, Edmonton lawyer
Michael Furman claimed he was required to travel to "network" to obtain new
clients. For that reason, he joined the board of a touch football league.
Mr. Furman took several trips attending touch football tournaments in
Kelowna, B.C., Regina and Saskatoon, and claimed travel costs of approximately
$2,400 on his tax return. Mr. Furman testified that the purpose of these trips
was for "networking" and "the board work was solely to obtain potential
The judge disallowed the travel costs and found that Mr. Furman's touch
football trips were not travel "in the course of employment" since there was no
requirement that he travel away from Edmonton to get new clients nor was there
any requirement for Mr. Furman to establish an Alberta-wide or Canada-wide
As the judge concluded, "there is always a fine line between a lawyer's
activities being performed for promotional purposes and consequently within the
course of employment and for pleasurable, civic minded, charitable or any number
of other purposes. One might altruistically hope that lawyers enter volunteer,
charitable, sports or other activities because they are sincerely interested in
contributing to the betterment of such organizations, be it as a volunteer,
director, coach, teacher, whatever. To suggest such activities are 'in the
course of the individual's employment as a lawyer' is frankly not how I would
like the public to perceive a lawyer's involvement."
While it is unclear whether the CRA has specifically targeted football (be it
professional or touch) as an area fraught with potential tax abuse, employees
may want to exercise additional caution before deducting their employment
related travel costs.
GRAPHIC: Black & White Photo: JEAN LEVAC; CANWEST NEWS SERVICE; Oteman Simpson,
a former CFL quarterback, was denied a dedution for $14,000 of travel expenses
incurred in Toronto and Calgary.