CRA confirms that s. 8(14)(e)(iii) does not preclude a labour mobility deduction for the excess of temporary relocation expenses over non-taxable allowances received

Ss. 8(1)(t) and 8(14) provided the labour mobility deduction to an eligible tradesperson for eligible temporary relocation expenses, which include temporary lodging expenses incurred to travel long distances to earn income from temporary employment in construction, where all the requirements were satisfied.

CRA confirmed that such a tradesperson could (in this context of the other requirements being satisfied) deduct the difference between their accommodation expenses of $200 per night for 15 nights, and the non-taxable allowance received from their employer of $125 per night. Regarding the s. 8(14)(e)(iii) prohibition against taking the deduction “to the extent that” inter alia the tradesperson receives an allowance “in respect of” the relocation expenses unless the allowance is included in their income, CRA indicated that the quoted language excluded the deduction only for the “portion” of the expense which was matched by the non-taxable allowance, so that the $75 per night excess was deductible.

Neal Armstrong. Summary of 9 October 2025 APFF Roundtable, Q.5 under s. 8(14)(e)(iii).