Special rules for artists and entertainers

Artists and entertainers are entitled to special treatment under the Income Tax Act.

If you’re employed as a musician and are required to provide a musical instrument as a condition of your employment, you may deduct the cost of maintenance, rent or capital cost allowance (CCA) (see topic 7) and insurance for the instrument. The amount deducted for musical instrument costs cannot exceed the income from employment as a musician after you deduct all other employment expenses.

Artists and entertainers receiving employment income are entitled to deduct related expenses actually incurred, up to a maximum of 20% of such income but not more than $1,000. This deduction is in addition to the deductions that all employees may be entitled to for most other expenses, such as automobile and related travel expenses. However, it’s reduced by the sum of the amounts claimed for interest and capital cost allowance on an automobile and for musical instrument costs (see above). Expenses incurred in the year but restricted by the 20% or $1,000 limit may be carried forward indefinitely.