The moving expense deduction can save you thousands of dollars on your tax return. If you relocated for a new job, to start a business, or to attend school, many of your moving costs are tax-deductible.
Who qualifies
You can claim moving expenses if:
- You moved to be at least 40 km closer to a new work location or post-secondary school
- You moved within Canada (or into Canada from abroad, in some cases)
- You have employment, self-employment, or scholarship income at the new location to deduct against
The 40 km rule
| Old Home → Work | New Home → Work | Distance Reduction | Qualifies? |
|---|---|---|---|
| 50 km | 8 km | 42 km | Yes |
| 30 km | 5 km | 25 km | No |
| 60 km | 15 km | 45 km | Yes |
The 40 km is measured by the shortest normal driving route, not straight-line distance.
Eligible moving expenses
Transportation and travel
| Expense | Deductible? |
|---|---|
| Moving company / movers | Yes |
| Truck rental (if DIY move) | Yes |
| Packing materials | Yes |
| Storage (up to 15 days) | Yes |
| Travel to new home (vehicle or flights) | Yes |
| Meals while travelling | Yes (flat rate or actual) |
| Hotel/accommodation during move | Yes |
Temporary living expenses
| Expense | Deductible? | Limit |
|---|---|---|
| Temporary housing near old or new home | Yes | Up to 15 days |
| Meals during temporary stay | Yes | Up to 15 days |
Selling your old home
| Expense | Deductible? |
|---|---|
| Real estate commission | Yes |
| Legal fees for selling old home | Yes |
| Mortgage penalty for breaking your mortgage | Yes |
| Advertising costs | Yes |
Buying your new home
| Expense | Deductible? |
|---|---|
| Legal fees for purchasing new home | Yes |
| Land transfer tax | Yes |
| Connection/disconnection of utilities | Yes |
Other costs
| Expense | Deductible? |
|---|---|
| Updating driver’s licence and vehicle registration | Yes |
| Updating legal documents | Yes |
| Cancellation fees (lease, cable, phone) | Yes |
| Mail forwarding costs | Yes |
Not eligible
- Losses on the sale of your old home
- House-hunting trips before the move
- Costs of cleaning or repairing the old home
- Costs of moving items you did not own at the old residence
Vehicle expenses: two methods
If you drive to your new home, you can claim vehicle costs using:
Simplified method (flat rate)
Claim a flat per-kilometre rate set by the CRA (varies by province, approximately $0.70/km for the first 5,000 km and $0.64/km after that).
Detailed method
Claim actual gas, oil, maintenance, insurance, and depreciation for the kilometres driven during the move.
Meal expenses
You can claim meals using:
- Simplified method: $23 per meal (3 per day maximum = $69/day per person)
- Detailed method: Actual receipts
Deduction limits
Moving expenses can only be deducted against income earned at the new location:
- Employees: Against employment income from the new job
- Self-employed: Against business income at the new location
- Students: Against scholarships, bursaries, and employment income at the school location
If your moving expenses exceed your current-year income at the new location, you can carry the unused portion forward to the next year.
Example: Moving for a new job
| Expense | Amount |
|---|---|
| Professional movers | $3,500 |
| Travel (1,000 km × $0.70) | $700 |
| Meals (2 travel days × 2 people × $69) | $276 |
| Hotel (1 night × $150) | $150 |
| Temporary accommodation (10 days × $120) | $1,200 |
| Legal fees (selling old home) | $1,200 |
| Real estate commission | $12,000 |
| Legal fees (buying new home) | $1,500 |
| Land transfer tax | $3,000 |
| Total eligible expenses | $23,526 |
This $23,526 deduction reduces taxable income dollar for dollar. At a 40% marginal tax rate, that is $9,410 in tax savings.
How to claim
- Complete Form T1-M (Moving Expenses Deduction)
- Attach to your tax return
- Keep all receipts for at least 6 years
Bottom line
If you moved 40+ km closer to work or school, the moving expense deduction is one of the most generous tax deductions available. Real estate commissions, legal fees, and land transfer tax alone can save you thousands. Do not leave this money on the table. Use our income tax calculator to see how the deduction affects your tax bill.
Moving for school: full-time students
Post-secondary students can also claim moving expenses when they move to attend a university, college, or other designated institution — even if they do not yet have a job at the new location. The 40 km rule applies equally.
Key difference for students: Moving expenses can only be deducted against:
- Taxable scholarships, bursaries, or fellowship income
- Part-time or full-time employment or self-employment income earned at the new location
You cannot deduct moving expenses against student loan proceeds or OSAP payments, which are not taxable income. If you have a summer job at your university town and then move into residence, the employment income creates room to deduct your moving costs.