How much of a business meal can I deduct in Canada?

CRA allows you to deduct 50% of the cost of meals and entertainment that have a genuine business purpose. The expense must be reasonable, directly related to earning business income, and supported by receipts. The 50% limit applies to meals, beverages, and gratuities at restaurants, as well as tickets to events where the primary purpose is entertaining clients.

Can employees deduct meals on their taxes?

Employees can deduct meals in very limited circumstances — specifically when they are required by their employment duties to be away from their employer''s establishment for a minimum of 12 hours and the meal cost was not reimbursed. This typically applies to employees working away from their normal work location for a day or overnight. A T2200 is required. The 50% limit still applies.

Are holiday parties and staff events deductible?

A maximum of 6 social or recreational events per year for all employees qualify for a 100% deduction (the 50% rule does not apply to these events). For 2026 this applies to events like staff holiday parties, annual picnics, and similar broadly inclusive events. Meals at events that are primarily for entertainment rather than business are still subject to the 50% limit.

Do I need to keep receipts for every business meal?

Yes. CRA expects receipts for meal expenses. Your receipt should show the restaurant name, date, items ordered, and total amount including tax and tip. You should also note on the receipt (or in a log) who attended and the business purpose of the meal. Without this documentation, the claim will be denied on audit.

Can I deduct meals I eat alone while working late?

No. Meals you eat alone — even while working late, during business travel close to home, or at your desk — are generally personal expenses. CRA does not allow deductions for meals eaten alone unless you are away from home overnight on business travel, in which case you can deduct 50% of reasonable meal costs.

Can I Deduct Meals on Taxes in Canada?

Meals and entertainment are among the most frequently claimed — and most frequently disallowed — business expenses in Canada. CRA’s 50% rule is well-known, but many people misunderstand what actually qualifies. Here is the complete picture.

The 50% rule: what it means

Under Section 67.1 of the Income Tax Act, the cost of food, beverages, and entertainment is only 50% deductible, even when it qualifies as a legitimate business expense.

This applies to:

Restaurant meals with clients, customers, or business associates
Food and drinks at business events
Tickets to sporting events, concerts, or theatre when used for client entertainment
Gratuities (tips) on qualifying meals

The 50% cap is applied after you calculate the business-use portion. So if a client dinner cost $200, you can only include $100 in your deductible business expenses.

What qualifies as a deductible meal

For a meal to be deductible at all (before the 50% cap), it must meet all of these tests:

Business purpose — The primary reason for the meal is to conduct business (a client meeting, a sales call, discussing a work project)
Reasonable amount — CRA expects the cost to be reasonable relative to the business conducted. A $500/person dinner for a $2,000 contract is questionable.
No reimbursement — If your employer or a client reimbursed you, you cannot also deduct the expense
Documentation — Receipt plus notes on who attended and why

Meals you cannot deduct

Situation	Deductible?
Eating alone at your desk or home office	❌ No
Groceries for your home	❌ No
Meals with a friend who happens to be in the same industry	❌ No
Office coffee and snacks for yourself	❌ No
Meals reimbursed by employer or client	❌ No (already compensated)
Meal before or after a flight (domestic)	❌ Generally no
Meals during overnight business travel	✅ 50% deductible
Client dinner with genuine business agenda	✅ 50% deductible
Employee meal: away from employer for 12+ hours	✅ 50% (T2200 required)

Exceptions where 100% is deductible

A few situations allow the full cost without the 50% limitation:

Staff events open to all employees — Up to 6 qualifying events per year (annual holiday party, summer picnic, etc.). Must be available to all employees at a location, not just select managers.
Meals included in a conference or seminar fee — If the cost of meals is included in a conference registration fee that is primarily educational, the full cost may be deductible.
Long-haul truck drivers — Eligible for an 80% deduction on meal costs (instead of 50%) when driving over prescribed distances.
Remote worksites — Meals provided to employees at a remote work location where no reasonably accessible meal alternatives exist may be 100% deductible.

Employee-specific rules

Employees can only claim meal expenses if they meet T2200 employment-expense requirements:

They use Form T777 and have a signed T2200
The employment conditions require them to be away from the employer’s establishment for a period of at least 12 hours
The meal was not reimbursed by the employer

Employees cannot deduct meals eaten at their regular work location, even if they work overtime.

Self-employed: claiming on T2125

Self-employed individuals claim meals and entertainment on Form T2125, Part 2 (Income Statement). Enter the total qualifying meal costs in the “Meals and entertainment” line, and CRA automatically applies the 50% limitation when calculating your business income.

Keep a meal log — either digital or paper — with:

Date
Restaurant/venue name
Names of all people at the meal
Their relationship to your business (client, supplier, referral partner)
Business purpose discussed
Total bill and tip

Record-keeping requirements

CRA can audit meal claims up to 6 years back. Keep:

Original receipts (not just credit card summaries)
Your meal log / notes on business purpose
Any calendar entries confirming the meeting took place

Credit card statements alone are not sufficient — they do not show what was purchased or who was present.

Trade shows, conferences, and business events

The rules at trade shows and conferences are more nuanced:

Type of meal	Deductible?
Registration fee that includes meals	Fully deductible as a conference cost (meals portion not separated)
Meals you buy separately at a conference	50% deductible (standard meals rule)
Client entertainment dinner the night before a trade show	50% deductible if business purpose is clear
Team dinner for all staff at a conference	Possibly 100% if it qualifies as a staff event; 50% otherwise

GST/HST input tax credits on meals

If you are registered for GST/HST, you can claim input tax credits (ITCs) on the GST/HST paid on business meals — but only on the deductible portion. Because meals are 50% deductible, you can recover only 50% of the GST/HST you paid.

Example:

Client dinner: $200 + $26 GST/HST = $226 total
Business expense claimed: $100 (50% of $200)
ITC recoverable: $13 (50% of $26)

Record both the net GST/HST amount and the ITC amount on your GST/HST return in the same proportion as the income tax deduction.

When CRA audits meal claims

Meal and entertainment expenses are one of CRA’s most common targets in small business and self-employment audits. CRA red flags include:

Meal expenses that are unusually high relative to reported revenue
Regular meals with the same individual (could indicate personal rather than business)
No documentation of who attended or why
Restaurant receipts without any business purpose noted

The CRA’s guide IT-518R covers food, beverages, and entertainment expenses in detail and is the authoritative source if you face an audit or have complex situations.

Can I Deduct My Car for Work in Canada? — Another common business expense with similar documentation rules
Can I Deduct Home Office Expenses in Canada? — T2200 and T777 guide for employees
Self-Employed Tax Guide Canada — Full T2125 walkthrough
How to Deal with a CRA Audit — What happens if a meal claim is questioned