If you moved to start a job, run a business or study full time at a post-secondary school, and the move brought you at least 40 km closer to that new location, many of your moving costs are deductible on line 21900. Because it is a deduction, it lowers taxable income, and it can only be used against income earned at the new location. This page covers the 40 km test, which costs count, the two ways to claim vehicle and meal costs, the income limit and carry-forward, and the rules for students. It is one of the Canadian tax deductions and credits covered in this guide.
Who qualifies
You can claim moving expenses if:
- You moved to start working at a new location (a new job, a transfer, or returning to Canada), to run a business from a new location, or to attend full-time post-secondary school (university, college, CEGEP)
- Your new home is at least 40 km closer to the new work or school location than your old home was
- 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 test
The test compares two distances to the new work or school location:
Distance from old home to new location − Distance from new home to new location ≥ 40 km
| Old Home → New Work | New Home → New 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 distance from your old home to your old job doesn’t matter. Distances are measured by the shortest normal route (the usual travelled route, typically by road), not a straight line. Some informal guides describe the test as straight-line distance, but the CRA’s guidance uses the shortest normal route.
Eligible moving expenses
Transportation and travel
| Expense | Deductible? |
|---|---|
| Moving company / movers | Yes |
| Truck rental (if DIY move) | Yes |
| Packing materials | Yes |
| Storage of household effects (in-transit) | Yes (no specific day limit; the 15-day cap applies to temporary lodging/meals, not storage) |
| Travel to new home (vehicle or economy airfare) | 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 because of the move | 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 |
| Cancelling the lease on your old home | Yes |
| Other cancellation fees (cable, phone) | Yes |
| Mail forwarding costs | Yes |
Not eligible
| Expense | Why not |
|---|---|
| House-hunting trips before the move | Pre-move decision costs are personal |
| Cleaning or repairing the old home (including a rental, to get the deposit back) | Personal obligation |
| Renovations before selling | Capital improvement, not a moving cost |
| Loss on the sale of your old home | Capital loss, separate treatment |
| Moving items you did not own at the old residence | Not your household effects |
| New furniture or appliances, landscaping at the new home | Personal purchases |
| Commuting costs after the move | Not a moving expense |
Vehicle and meal costs: two methods
Vehicle
- Simplified method: claim a flat per-kilometre rate set by the CRA for moving, medical and northern-residents travel. It is a single cents/km figure with no tiering after 5,000 km, it is a separate table from the employer mileage-reimbursement rate, and it varies by the province or territory where the trip began (for example, Ontario’s rate was 62.0 cents/km for the 2025 tax year). The CRA publishes the rates each year on its “Meal and vehicle rates used to calculate travel expenses” page.
- Detailed method: claim actual gas, oil, maintenance, insurance and depreciation for the kilometres driven during the move, with receipts.
Meals
- Simplified method: $23 per meal (3 per day maximum = $69/day per person), without receipts
- Detailed method: actual receipts
The income limit and carry-forward
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 taxable scholarships, bursaries and research grants, and against employment income at the school location
If your moving expenses exceed that income in the year of the move, the unused portion carries forward to the next year, against the same kind of income.
Example:
- Eligible moving expenses: $8,500
- Employment income earned at new location before year-end: $6,000
- Deduction in year of move: $6,000
- Carried forward: $2,500
Example: moving for a new job
| Expense | Amount |
|---|---|
| Professional movers | $3,500 |
| Travel (1,000 km × $0.62, Ontario 2025 rate) | $620 |
| 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 | $23,446 |
This $23,446 deduction reduces taxable income dollar for dollar. At a 40% marginal tax rate, that is $9,378.40 in tax savings, provided the employment income at the new job is at least that large (otherwise the rest carries forward).
When your employer pays
What you can deduct depends on how your employer handled the move: costs reimbursed tax-free can’t be claimed, while reimbursements added to your T4 as a taxable benefit, and costs nobody paid you back for, can. Which employer relocation payments are tax-free and which are taxable is covered in whether relocation assistance is taxable.
Moving for school: full-time students
Post-secondary students can claim moving expenses when they move to attend a university, college, or other designated institution, even if they don’t yet have a job at the new location. The 40 km test applies the same way.
Key difference for students: the income a student’s moving expenses are deducted from depends on why they moved (CRA Guide P105):
- A move to attend a post-secondary school full-time: only the taxable part of scholarships, fellowships, bursaries, certain prizes and research grants
- A move for a job, including a summer job, or to run a business: the employment or self-employment income earned at the new location
Student loan proceeds and OSAP payments aren’t taxable income, so moving expenses can’t be deducted against them. Moving into residence to start classes is a move to study, so those costs come off taxable scholarship and bursary income only, not off pay from a summer job.
How to claim
- Complete Form T1-M (Moving Expenses Deduction)
- Enter the deduction on line 21900 of your return
- You don’t attach receipts, but keep them for 6 years in case the CRA asks
A move between provinces changes your provincial tax and benefits; see the tax implications of moving provinces.