Meals and Entertainment Expenses
The 50% rule for business meals and entertainment, and the exceptions that get 100%.
The short version
- Business meals and entertainment are generally 50% deductible, on line 8523 of form T2125.
- That includes meals with clients, tickets to games and shows for clients, and meals while travelling on business.
- Exceptions get 100%: up to six events a year that all employees at a location are invited to, meals you bill to a client on the invoice, meals at remote work sites and construction camps, and charity fundraising events.
- Long-haul truck drivers can deduct 80% of meals on qualifying trips.
- Your own lunch on a normal workday isn't deductible at all. Neither are golf or social club memberships.
Meals and Entertainment Tax Deduction Canada
The 50% rule is the tax system's compromise: a client lunch is part business, part lunch, and nobody wants to argue about which bite was which. So you get half. Where people get into trouble is claiming lunches with nobody but themselves, or the family dinner with a business card on the table.
What Counts
| Expense | Deductible |
|---|---|
| Lunch or dinner with a client, prospect or supplier to discuss business | 50% |
| Tickets to a game, show or event for clients | 50% |
| Meals while travelling away from home on business | 50% |
| Coffee and snacks at a client meeting | 50% |
| Up to six staff events a year open to all employees at a location | 100% |
| Meals billed to a client and shown on the invoice | 100% |
| Meals at a remote work site or construction work camp | 100% (conditions apply) |
| Long-haul truck drivers on eligible trips | 80% |
| Your own lunch on a regular workday | 0% |
| Golf, fitness, dining or social club dues | 0% |
The deductible amount is also limited to what's reasonable. A $900 bottle of wine for a $500 job won't pass.
What to Write on the Receipt
The receipt shows the restaurant, the date and the amount. CRA also wants to know who you were with and why. A note on the back or in your bookkeeping app (“J. Smith, ABC Builders, discussed Collingwood framing contract”) turns a doubtful expense into a supported one. See what receipts to keep.
Is this meal deductible, and how much?
Describe the meal or event, who was there and why. The assistant tells you whether it's 0%, 50%, 80% or 100% deductible and what to note on the receipt.
GST/HST on Meals
GST/HST registrants can claim input tax credits on meals and entertainment, but generally only 50% of the GST/HST, to match the income tax rule. Your bookkeeping software usually handles it if the expense is coded to meals. See the GST/HST guide.
Five Rules of Thumb
- Write the who and why on every meal receipt the same day.
- Code the staff party separately so it gets 100%, not 50%.
- Bill meals to clients when your contract allows it; billed meals are fully deductible.
- Don't claim your own lunches, even on a busy site day.
- Keep it reasonable. Big meal claims relative to revenue are an easy review target.
Meals are one line among many on the T2125; the others are on business expense deductions. Return Check flags meal claims that look high for your business before you file. Employees have their own rules; see employment expenses.
Meals and Entertainment Questions
How much of business meals can I deduct in Canada?
Generally 50% of the cost of business meals and entertainment, claimed on line 8523 of form T2125.
Are staff Christmas parties 100% deductible?
Yes, up to six events a year to which all employees at a particular location are invited are not subject to the 50% limit.
Can I deduct my lunch when I am working?
No. Your own meals on a normal workday are personal expenses. Meals while travelling away from home on business are 50% deductible.
Are golf memberships deductible?
No. Dues for clubs whose main purpose is golf, dining, recreation or sport are not deductible.
What can long-haul truck drivers deduct for meals?
80% of meal costs during eligible trips of at least 24 hours away from the home terminal and beyond a 160 km radius.
Sources: CRA, Line 8523 Meals and entertainment; Guide T4002. Checked October 2026. The GST/HST input tax credit restriction on meals is summarized.
Last reviewed October 4, 2026 against CRA and Government of Canada sources. How we check our facts.