PERSONAL TAX TRAINING

APPRENTICE MECHANICS TOOLS DEDUCTION

Tools Deduction on Line 22900 of T1 Return

As an apprentice mechanic, you can deduct the cost of eligible tools you purchased to earn employment income. This deduction is claimed on Line 22900 of your T1 return. Here are the key points you need to know:

Eligibility Criteria

Eligible Apprentice: You must be employed as an apprentice mechanic, which means you are registered under a federal or provincial program to repair self-propelled motorized vehicles. Your employer must certify that the tools are necessary for your employment.

Eligible Tools: The tools must be required as a condition of your employment and used directly in your trade. This includes new tools purchased and replacements for existing ones. Additionally, electronic communication devices or calculators are not eligible unless they are primarily used for locating or calculating specific trade-related tasks.

Deduction Limit

The maximum deduction for eligible tools is calculated as follows:

• Up to $1,000 for taxation years after 2023. For taxation years before 2023, the maximum deduction is $500.
• If your employer reimburses any portion of the cost, only the unreimbursed amount can be claimed.
• Unused amounts may be carried forward to future years and added to claims for subsequent purchases.

Claiming and Filing

To claim the apprentice mechanics tools deduction, you must:

• Enter your claim on Line 9131 of Form T777, "Statement of Employment Expenses."
• Provide a detailed list of tools purchased, along with receipts. Attach Form T2200, "Declaration of Conditions of Employment," signed by your employer to confirm the requirement for tools.
• Retain all documentation for at least six years in case of CRA review.

Disposition of Tools

If you sell or dispose of any tools for which you claimed a deduction in previous years, the proceeds may need to be included as income. This is calculated as the lesser of:

• The amount received from the sale or disposition of the tool.
• The original cost of the tool, minus any deduction claimed in previous years.

Include this amount on Line 13000 of your T1 return. For adjustments, refer to the CRA Guide T4044.

Example Calculation

The adjusted cost of each eligible tool sold must be recalculated using the formula: D - (D x [E/A]), where:

• D is the original cost of the tool.
• E is the total tradesperson's tools deduction previously claimed.
• A is the total cost of all tools purchased in the year.

Additional Considerations

If you use any tools for both employment and personal purposes, only the portion of the cost directly related to your employment is deductible. Furthermore, any reimbursements received from your employer will reduce the deductible amount accordingly.

Disclaimer

The information provided on this page is intended for general informational purposes only and does not constitute professional tax advice. Please consult a tax professional for advice tailored to your individual circumstances.

If you need professional advice, you can book an appointment by calling 403-475-8600 or by visiting our booking page.

Last updated: February 2025

For more detailed information, refer to the Canada.ca website or consult the CRA's Guide T4044.

By understanding these details, you can effectively manage your tax deductions and ensure compliance with CRA requirements.