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How is a live-out allowance recorded in accounts?
Expert: Hank Bulmash
Deb asked:
I will be getting a live-out allowance from some clients as my jobs are hundreds of miles from home. How do I record that in my accounts as it is a tax-free benefit? Do I still need receipts.
Hank Bulmash answered:
Employees can receipt a tax-free allowance to compensate them for working on a remote work-site. The benefits they receive for this are simply not included on their T4's.
If you are running your own business, no receipts are tax exempt. Expenses incurred by a business such as travel and remote living expenses are deductible expenses.
Amounts received as compensation for providing services far from home are invoiced and included as revenue in the business accounts. Expenses are deducted.
About the author
Hank Bulmash
Bulmash Accounting Professional Corporation/CPA
Linked In: https://www.linkedin.com/pub/hank-bulmash/0/389/811