🍽️ When You Can Write Off 100% of Your Meals and Entertainment?

Most business owners know the CRA only allows 50% of meals and entertainment expenses as a deduction — but did you know there are situations where you can write off 100%?

Understanding the difference can save you money and protect you in the event of an audit. Here’s a breakdown of when you can (and can’t) claim the full amount.

💼 1. When Meals Are Part of What You Sell

If food or entertainment is included in the price of a product or service you charge clients for, those costs become part of your cost of goods sold (COGS) — meaning they’re 100% deductible.

Examples:

• You host a paid workshop or retreat that includes lunch for attendees.

• You operate a catering or event business that supplies meals.

• You run tours or retreats that include food and drink in the price.

📘 Tip: Be sure the meals are clearly tied to your business offering and shown as part of the invoice or ticket price.

🎉 2. Staff Events and Parties

You can write off 100% of meals and entertainment for staff events — up to six times per year.

Examples:

• A holiday party open to all employees.

• A summer team BBQ or staff appreciation event.

• Company lunches that celebrate milestones or achievements.

✅ Key Rule: The event must be available to all employees, not just management or select staff.

⏰ 3. Meals for Overtime Work

If your employees (or you) work overtime and the company provides or reimburses meals, that expense is 100% deductible.

Example:Your bookkeeper stays late finalizing year-end reports, and you cover dinner — this counts as a fully deductible business expense.

🏗️ 4. Meals at Remote Worksites

When staff must work at remote locations, and meals are provided there as part of the job, those meals are also fully deductible.

Examples:

• Construction or landscaping crews working at remote sites.

• On-location event teams where food is included during shifts.

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💳 5. Meals Charged Back to a Client

If you pay for client meals while on a project and bill them directly back to the client, the cost becomes part of your reimbursed revenue — so it’s 100% deductible.

Example:You take a client to lunch during a consulting project, include it on your client invoice, and get reimbursed, that expense is fully deductible.

🚫 When It’s Only 50% Deductible

In all other cases, the CRA restricts your deduction to 50% of the cost. That includes:

• Taking a client out for a meal (not billed back).

• Regular team lunches or casual coffee meetings.

• Meals during business travel (not included in your invoice).

• Entertainment such as concert tickets or golf outings.

  
  

🧾 Keep It Audit-Proof

Always keep detailed records — receipts, dates, attendees, and the business purpose for each expense. The CRA can deny deductions if your records don’t show a clear business connection.

💡 Pro Tip: In QuickBooks Online or Dext, set up two expense categories:

• Meals & Entertainment – 50% deductible

• Meals & Entertainment – 100% deductible

This helps your bookkeeper (or the CRA) see exactly how expenses were classified.

✅ The Takeaway

While most meal and entertainment expenses are capped at 50%, knowing when you can claim 100% keeps you both tax-efficient and compliant.When in doubt, document everything — and lean on your bookkeeper to help you code and track these correctly.

Need help organizing your expenses or setting up categories in QuickBooks?Tidier Books can help you streamline your bookkeeping, automate deductions, and stay audit-ready.

📩 Contact Tidier Books to get started today.

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