Business Cell Phone and Internet Deduction
How self-employed people and employees deduct cell phone and internet costs: business-use percentage, devices through CCA, home office overlap and records.
The short version
- Self-employed people can deduct the business-use share of their cell phone plan and home internet. A phone used 70% for business means 70% of the monthly bill.
- A second line or a phone used only for business is 100% deductible. Your one personal phone, used partly for work, is a percentage.
- The phone itself, and computers, are capital purchases: claimed over time through capital cost allowance, not all at once.
- Home internet can be claimed directly by its business share, or as part of business-use-of-home expenses. Not both.
- Employees are different: with a signed T2200 they can deduct reasonable airtime and data, but not the phone, connection fees or internet installation.
Business Cell Phone and Internet Deduction
For most self-employed people, the phone is the office, the filing cabinet and the front desk, which makes it one of the most legitimate deductions on the return and one of the most casually guessed. "About 80% business" is a number everybody uses and nobody can prove. CRA doesn't ask for perfection. It does want a method, and a reason the number isn't 100%.
What You Can Deduct
| Cost | Self-employed | Employee with a T2200 |
|---|---|---|
| Monthly cell plan | Business-use % | Reasonable business share of airtime and data |
| Separate business line | 100% | If required for the job |
| Long distance and roaming for business calls | 100% of those charges | Yes |
| The phone, tablet, laptop | CCA, business-use % | No (commission employees: limited exceptions) |
| Home internet | Business-use %, or through home office | Monthly fee, business share; not installation |
| Connection or activation fees | Yes, business share | No |
Self-employed claims go on form T2125; see filling out the T2125 and the full list on business expenses. Employees: employment expenses and working from home.
Not sure what percentage to claim?
Tell the assistant how you use your phone and internet, what you pay, and whether anyone else in the house uses them. It suggests a method CRA accepts, the amounts to claim, and where they go on your return.
Working Out the Business Percentage
- Track a typical month. Count business calls, minutes or data from the itemized bill, or keep a log for a month or two each year.
- Apply it to the year, and note any months that were different, like a slow winter.
- Keep the reasoning with your records: a short note, the sample bills, and how you got the number.
- Be realistic. A single phone that's also the family's only phone is rarely 100% business. A dedicated line is.
- Don't double count internet in both the phone line and the home office claim.
Example: A Contractor's Phone and Internet
| Cost for the year | Total | Business share | Deduction |
|---|---|---|---|
| Cell plan, $85 a month | $1,020 | 75% | $765 |
| Home internet, $80 a month | $960 | 40% | $384 |
| New phone, $1,400 | $1,400 | 75% | Through CCA over several years |
| Deduction this year, before CCA | $1,149 |
At a 30% marginal rate, that's about $345 less tax before the phone's CCA, plus some CPP savings. If you're registered for GST/HST, claim the business share of the HST on the bills as input tax credits; see input tax credits. Equipment classes and rates: tools and equipment and capital cost allowance.
Mistakes People Make
- Claiming 100% of the family plan. Each line is its own calculation.
- Expensing the new phone in full. It's a capital purchase; the CCA class and rate depend on the device.
- No records. In a review, CRA asks for bills and a basis. Keep both; see recordkeeping.
- Paying it through a corporation without a plan. If your company pays your personal phone, it's a taxable benefit unless it's a business phone; see taxable employee benefits.
Phone and Internet Questions
Can I deduct my cell phone bill if I’m self-employed?
Yes, the business-use portion. If you use your phone 70% for business, you can deduct 70% of the plan. A separate line used only for business is fully deductible.
Can I deduct the cost of a new phone?
Not all at once. A phone, tablet or computer is a capital purchase claimed through capital cost allowance over several years, for the business-use share.
Can I deduct home internet as a business expense?
Yes, the business-use share, either directly or as part of your business-use-of-home expenses. Don’t claim it in both places.
Can employees deduct their cell phone?
Employees with a T2200 from their employer can deduct a reasonable business share of airtime and data on a plan they pay for. They can’t deduct the phone, connection fees or internet installation.
How do I prove the business use of my phone?
Keep itemized bills and a short record of how you worked out the business percentage, such as a log of business calls and data for a sample period.
Sources: CRA, Guide T4002, chapter 3: business expenses; CRA, T4044, Employment Expenses. Checked October 2026. The business percentage is your estimate and must be reasonable. CCA classes for phones and computers depend on the device; the example's rate is illustrative.
Last reviewed October 5, 2026 against CRA and Government of Canada sources. How we check our facts.