From Our Office
October is a good time to think about decisions that may still happen before year-end. One question that often comes up as December approaches is whether a business should make a purchase now in order to “write it off” for tax purposes.
This month, we’re taking a closer look at year-end business purchases: what a tax deduction actually means, why some purchases are treated differently from ordinary expenses, and why the tax result should be considered alongside the business reason for the purchase.
Year-End Business Purchases
Thinking About a Year-End Business Purchase? Read This First
As year-end approaches, business owners sometimes hear advice along the lines of: “If you need something for the business, buy it before December 31 so you can write it off.” There can be tax considerations around the timing of a purchase, but the phrase “write it off” can make the benefit sound much simpler, and larger, than it really is.
Here are a few things worth understanding before making a year-end purchase:
A deduction does not make the purchase free. A deductible business expense reduces the income on which tax is calculated; it does not normally mean receiving the entire purchase price back in tax savings. A purchase should still make sense for the business.
Not every purchase is an ordinary current expense. Routine costs such as supplies may generally be treated differently from longer-lasting property such as furniture, equipment, computers or vehicles. Capital property is generally claimed through capital cost allowance (CCA) rather than simply deducting the full purchase price as an ordinary expense.
Timing can matter, but so can when an asset is ready for use. The tax treatment of depreciable property can depend on the type of property, when it was acquired and when it became available for use. Simply placing an order before December 31 does not necessarily answer the tax question.
Business versus personal use still matters. If an item is used partly for business and partly personally, the business-use portion and the rules for that type of property need to be considered.
Keep the supporting documents. Save the invoice, purchase agreement and financing information, and make a note of what the item is and when it was received or put into use. Good documentation makes the year-end treatment much easier to determine.
Ask before making a large purchase solely for tax reasons. If the timing of a significant equipment, vehicle or other asset purchase is being influenced by tax considerations, it can be worth discussing the transaction before committing to it. The best year-end purchase is one the business actually needs and can afford. Any tax benefit should support a sound business decision, not be the only reason for making it.
Review Your Recurring Business Costs
Take a few minutes to review subscriptions, software, memberships and other recurring charges. Are you still using everything you’re paying for? Small monthly charges can add up. Cancelling services the business no longer needs can improve cash flow without affecting operations.
QuickBooks Online Can Help You Keep Major Purchases Easy to Find
If you use QuickBooks Online with us, attaching invoices and supporting documents to transactions can make it much easier to identify major purchases when the books are reviewed at year-end.
For equipment, furniture, computers and other significant purchases, keeping the invoice with the bookkeeping record can help distinguish an ordinary expense from an item that may need to be recorded as a capital asset.
- Attach the invoice or receipt to the related transaction.
- Use clear descriptions so significant purchases are easy to recognize later.
- Keep financing or loan documents together with the purchase records.
- Flag unusual or high-value purchases for review rather than guessing at the category.
Good records do not determine the tax treatment by themselves, but they give your accountant the information needed to determine it correctly.
MYTH: “There is money in the bank, so the business must be profitable.”
REALITY: Cash in the bank and business profit are not the same thing. Timing of customer payments, loan proceeds and repayments, owner contributions or withdrawals, unpaid bills and other transactions can all affect cash without having the same effect on profit.
Your bank balance tells you how much cash is available at a point in time. Your financial statements tell a broader story about how the business is performing.
| Date | What to Watch | Why |
| Oct. 15, 2026 | Quarterly payroll remittance | Eligible quarterly payroll remitters have a July-to-September remittance due. Your payroll remitting frequency depends on your CRA remitter type. |
| Nov. 2, 2026 | Q3 GST/HST deadline for calendar-quarter filers | Monthly and quarterly GST/HST returns are generally due one month after the reporting period. Because October 31, 2026 falls on a Saturday, the CRA next-business-day rule moves the deadline to Monday, November 2. |
| Dec. 15, 2026 | Personal income-tax instalment | The fourth regular 2026 individual instalment is due for most individuals required to pay by instalments. |
| Dec. 31, 2026 | Calendar year-end | For calendar-year businesses, December 31 closes the 2026 financial year. Records should be as complete and current as possible. |
| Jan. 15, 2026 | Quarterly payroll remittance | Eligible quarterly payroll remitters have an October-to-December remittance due. Your payroll remitting frequency depends on your CRA remitter type. |
Year-End Purchase & Tax Planning
Considering a vehicle, computer, equipment upgrade or another significant purchase before year-end? The bookkeeping and tax treatment may depend on what you are buying, how it will be used, and the timing of the transaction.
A quick conversation before a major purchase can help clarify questions such as:
- whether the purchase is likely to be a current expense or capital property
- what documentation should be kept
- how business and personal use may affect the claim
- whether financing changes how the transaction should be recorded
- what timing or available-for-use considerations may apply
- what information will be needed when the books and tax return are prepared
The goal is not to buy something simply because year-end is approaching. It is to understand the tax and bookkeeping implications of a purchase the business already has a reason to make.
Planning a significant business purchase?
Mainville & Associates can help you understand the bookkeeping and tax considerations before year-end.
Coming Next Month
November’s Mainville Monthly will focus on the final stretch before year-end: what to review while there is still time to act, which records and balances deserve attention, and how to head into December with fewer loose ends.