Accounting Services

Moving Expenses Deduction Canada: Work vs. Student Rules

By November 2, 2026 No Comments
This article is for informational purposes only and does not constitute tax or financial advice. Consult a qualified accounting professional before making any tax or financial decisions.

Quick Answer: Can You Deduct Moving Expenses in Canada?

You can generally deduct moving expenses in Canada if your new home is at least 40 kilometres closer to a new work location, business, or post-secondary school. The deduction is claimed on CRA Form T1-M and reported on Line 21900 of your T1 return.

For workers, the deduction is capped at employment or self-employment income earned at the new location. For full-time students, the deduction is capped at the taxable portion of scholarships, bursaries, fellowships, research grants, or certain prizes reported at the new location.

Unused amounts can typically be carried forward and claimed in a future year.

Why This Deduction Matters Right Now

If you moved this summer for a new job, started classes at a new university, or packed up a family across the province for a career change, your shoebox of receipts is quietly worth money at tax time. The problem is that the Canada Revenue Agency (CRA) rules around moving expenses are easy to misread, and a wrong assumption can mean a reassessment letter six months after you file.

The good news: the rules are more straightforward than they look once you separate the two main stories, moving for work and moving for school. Each follows the same distance test but then diverges sharply on what income caps the claim and which receipts count.

This guide walks you through both paths in plain English, shows you the comparison side by side, and gives you a step-by-step method you can run through tonight at the kitchen table. For more Canadian tax explainers written for everyday filers, visit ClearWealth Insights.

40 kmMinimum closer-distance test
Line 21900T1 return line for the deduction
15 daysMax temporary accommodation
6 yearsRecord retention standard

Quick Start: Pick Your Path

Before you read further, choose the path that fits your move. Workers and self-employed filers follow one set of rules; full-time students follow a tighter version. If both apply, you may be able to claim under either path, but not twice for the same expenses.

Use the quick-start grid below to self-select, then read the sections that match your path.

Path A — Work or Self-Employment
You started working at a new Canadian location this year, as an employee or self-employed person. Your new home is at least 40 km closer to that new work location. You will claim against income earned at the new location.
Path B — Full-Time Student
You enrolled full-time at a university, college, or other post-secondary institution. Your new home is at least 40 km closer to that school. You will claim against the taxable portion of scholarship-type income reported at the school.

If both reasons apply (common for co-op students, interns, and graduate students on paid research), you may claim under either path, following the same 40 km test. Need help deciding which path applies to a mixed situation? Our personal tax services cover the full range of individual filings, including moves across provinces and in and out of Canada.

The CRA 40-Kilometre Rule, Explained Simply

To qualify for the moving expenses deduction in Canada, your new home must be at least 40 kilometres closer to your new work or school location than your old home was. The CRA generally measures this using the shortest normal route by public road, not straight-line distance.

Here is the test in one line. Take the distance from your old home to the new work or school location. Then take the distance from your new home to the same new work or school location. If the first number is at least 40 kilometres larger than the second, you pass the distance test.

A quick example. You lived in Oshawa and your new job is in downtown Toronto, roughly 60 kilometres away by road. You moved to a condo in Toronto that is 5 kilometres from the office. The old home was 60 km from work; the new home is 5 km from work. The difference is 55 km, which is well above the 40 km threshold, so the distance test is met.

The CRA generally accepts the shortest normal route by public road for both measurements. If your route is unusual (ferry, seasonal road, bridge closure), keep a written record of the route you used and why.

Work Moves vs. Student Moves: Side by Side

Workers and students both pass through the same 40 km door, but what happens on the other side is different. The biggest divergence is the income cap: workers claim against employment or self-employment income earned at the new location, while students claim only against the taxable portion of scholarship-type income.

The side-by-side view below is the piece most Canadians miss. If you are a student moving for school and expect to deduct the move against a part-time job unrelated to a scholarship, the CRA rules will typically say no. If you are a worker who moved mid-year and only earned a few months of salary at the new location, your claim is limited to that income, with the rest carried forward.

Note that some tradespeople and apprentices whose moves do not qualify under Line 21900 may still qualify for the separate Labour Mobility Deduction. Read our guide to the Labour Mobility Deduction to see whether that path fits your situation.

ClearWealth Accounting Advisors
How the Moving Expenses Deduction Differs for Workers and Students
The same 40 km door, two different sets of rules on the other side
Rule Work or Self-Employment Move Full-Time Student Move
Who qualifiesEmployee or self-employed person starting work at a new Canadian locationStudent enrolled full-time at a Canadian post-secondary institution
Distance testNew home at least 40 km closer to the new work locationNew home at least 40 km closer to the new school
Income capEmployment or self-employment income earned at the new locationTaxable portion of scholarships, bursaries, fellowships, research grants, or certain prizes
Eligible expensesFull Form T1-M category list including costs of selling the old homeSame category list, but typically with few or no home-sale costs
Carry-forwardUnused amounts can generally be carried forward against future income at the same locationUnused amounts can generally be carried forward against future eligible scholarship income
Form & lineCRA Form T1-M, reported on Line 21900CRA Form T1-M, reported on Line 21900
Source: Canada Revenue Agency, Line 21900 Moving expenses & Form T1-M.
ClearWealth Accounting Advisors · clearwealth.tax · For informational purposes only

What Counts as an Eligible Moving Expense

Eligible moving expenses generally include transportation and storage of household items, travel costs between the old and new home, temporary lodging for up to 15 days, lease-cancellation fees, incidental costs such as changing your address, and certain costs of selling the old home or buying the new one.

Here is a plain-English checklist of what the CRA typically accepts on Form T1-M:

  • →Transportation and storage costs for household items, including movers, packing, rental trucks, in-transit storage, and insurance on the goods while they are being moved.
  • →Travel expenses for you and members of your household to get from the old home to the new one, including reasonable meals and lodging on the way.
  • →Temporary living expenses near either the old or the new home for up to 15 days, covering meals and lodging while you wait to move in or move out.
  • →Costs of cancelling a lease on your old home, excluding any rent that was due for the period you still lived there.
  • →Incidental costs tied directly to the move, such as changing your address on legal documents, replacing driver’s licences and vehicle permits, and connecting or disconnecting utilities.
  • →Costs of selling your old home, including real estate commissions, legal fees, advertising, and mortgage-penalty charges.
  • →Costs of buying your new home if you sold the old one, including legal fees and land transfer taxes, within specific limits.

Expenses the CRA typically does not accept include house-hunting trips before the move, mail-forwarding costs, mortgage default insurance, and the cost of improvements to make your old home sell faster. If you also work from a home office at your new location, our guide to home office deductions covers the separate rules that apply there.

ClearWealth Accounting Advisors
Where Moving-Expense Dollars Typically Go on a Canadian T1-M
Illustrative share of a typical worker's claim by expense category
Biggest line
Transportation & storage
Watch closely
Real-estate costs
Source: ClearWealth illustrative distribution based on Canada Revenue Agency Form T1-M eligible categories. Shares are approximate and will vary by filer.
ClearWealth Accounting Advisors · clearwealth.tax · For informational purposes only

How to Claim Your Move: Step by Step

To claim moving expenses on your Canadian tax return, confirm you meet the 40 km rule, gather every receipt, complete CRA Form T1-M, enter the total on Line 21900 of your T1 return, and keep the supporting documents for six years. If your employer reimbursed any part of the move, that amount reduces your claim.
  1. 1
    Confirm the distance test.Measure the old home to new work distance and the new home to new work distance using a mapping tool, and check that the difference is at least 40 kilometres.
  2. 2
    Open a receipts folder on moving day.Collect mover invoices, truck rental agreements, fuel receipts, hotel and meal receipts for travel days, utility hookup bills, and any legal or real estate documents from selling the old home or buying the new one.
  3. 3
    Track income earned at the new location through the year.For workers, this is the employment or self-employment income tied to the new location. For students, this is the taxable portion of scholarships, bursaries, fellowships, research grants, or certain prizes received at the new school.
  4. 4
    Cross-check your tax slips when they arrive.In February and March, confirm that any employer reimbursement for the move is correctly reported on your T4 and understand whether it was a taxable benefit or a non-taxable allowance.
  5. 5
    Complete Form T1-M.Enter each category of expense, apply the income cap, and calculate the amount to claim this year plus any carry-forward balance.
  6. 6
    Transfer the deduction to Line 21900.Move the final deduction amount from Form T1-M to Line 21900 of your T1 return.
  7. 7
    Keep every receipt for six years.Retain all supporting documents for six years from the end of the tax year to which they relate, in case the CRA asks for them later.

Timing matters too. If your move affects your current-year balance owing, you may need to adjust your instalment payments. See our note on personal tax deadlines for the key dates.

ClearWealth Accounting Advisors
From Moving Day to T1 Filing: Your Claim Timeline
Six milestones from the day you move to the day you can safely discard supporting records
Retention rule
Keep supporting documents for six years from the end of the tax year
Source: Canada Revenue Agency, Keeping records. Timeline is illustrative for a filer who moves early in the calendar year.
ClearWealth Accounting Advisors · clearwealth.tax · For informational purposes only

Common Mistakes That Get Moving-Expense Claims Rejected

These are the errors we see most often on CRA reviews of moving-expense claims. Any one of them can trigger a reassessment letter.

  • →Measuring the 40 km test with straight-line distance instead of the shortest normal route by public road, which produces a number the CRA will not accept.
  • →Claiming the full moving total without applying the income cap, when the income earned at the new location is lower than the expenses in the first year.
  • →Forgetting that an employer reimbursement reduces eligible expenses dollar for dollar, and claiming the gross amount of the move anyway.
  • →Claiming house-hunting trips, mortgage default insurance, or mail-forwarding fees, which are not accepted on Form T1-M.
  • →Discarding receipts after filing, then having nothing to show when the CRA requests supporting documents during the six-year retention window.
  • →Students claiming the move against part-time employment income unrelated to a scholarship, which does not qualify under the student path.
  • →Missing the carry-forward opportunity when the current-year income cap is low, and losing the unclaimed balance by not tracking it to a future return.

Moving Expenses FAQ

Can I claim moving expenses if I moved for a new job in another city?

Yes, you can generally claim moving expenses if you moved within Canada for a new job and your new home is at least 40 kilometres closer to the new work location. The claim is capped at employment or self-employment income you earn at that new location in the year of the move.

Does the 40 kilometre rule use driving distance or straight-line distance?

The CRA generally uses the shortest normal route by public road, not straight-line distance. If your usual route is unusual due to ferries, bridges, or seasonal closures, keep a written note explaining the route you used.

Can I deduct moving expenses if my employer already paid for the move?

You can only claim moving expenses that you paid yourself and were not reimbursed for. If your employer paid part of the move directly or reimbursed you, that amount generally reduces your eligible claim. Non-taxable allowances also reduce the claim; taxable reimbursements included on your T4 are treated differently and may still be offset by eligible expenses.

I am a university student. Can I claim what it cost me to move to campus?

You may claim moving expenses if you moved at least 40 kilometres closer to a post-secondary school where you are enrolled full-time, but the claim is capped at the taxable portion of scholarships, bursaries, fellowships, research grants, or certain prizes received at that school. If none of that income applies, the deduction typically cannot be used in the current year.

What moving expenses are actually deductible on my Canadian tax return?

Deductible expenses generally include transportation and storage of household items, travel costs between the two homes, up to 15 days of temporary lodging, lease-cancellation fees, incidental costs such as address changes, and certain costs of selling the old home or buying the new one. House-hunting trips and mail-forwarding costs are not accepted.

Can I claim moving expenses if I only worked at the new location for a few months?

Yes, but your claim this year is capped at the income you earned at the new location during those months. Any unused balance can typically be carried forward and claimed against eligible income at the same new location in a future year.

Do I need to send my receipts to the CRA when I file, or just keep them?

You generally do not send receipts with your return. You keep them in case the CRA asks for proof during a review or audit. The standard retention period is six years from the end of the tax year to which the documents relate.

Can I claim moving expenses if I moved from Ontario to another province?

Yes. The moving expenses deduction is federal and applies to interprovincial moves within Canada. You claim it on your T1 return in the province where you were resident on December 31. Quebec filers also complete provincial Form TP-348.
ClearWealth Accounting Advisors
How a Moving-Expense Carry-Forward Can Work Across Two Years
Illustrative scenario: $8,000 in eligible moving expenses, income earned at new location grows into Year 2
Year 1 claimed
$5,000
Carried into Year 2
$3,000
Source: Canada Revenue Agency, Line 21900 Moving expenses, carry-forward rules. Figures are illustrative and vary by filer.
ClearWealth Accounting Advisors · clearwealth.tax · For informational purposes only

What happens if my moving expenses are more than my income at the new location?

The current-year claim is limited to the eligible income at the new location. The unused portion can typically be carried forward and claimed against eligible income at the same new location in a future year. Track the carry-forward amount so it is not lost.

Can I claim moving costs if I am self-employed and moved to start a new business?

Yes, self-employed Canadians can generally claim moving expenses if they relocate to carry on a business at a new location and meet the 40 km test. The deduction is capped at the self-employment income earned at that new location during the year.

Make Your Move Work for You at Tax Time

Two tests decide this deduction: the 40 km rule and the income cap at the new location. If your move involved an employer reimbursement, a cross-province relocation, a mixed student-and-work year, or a self-employed business move, the T1-M calculation deserves a second set of eyes.

Want help running the numbers before you file? Speak with a ClearWealth advisor and we will walk through your situation step by step.

Book a Consultation
This article is for informational purposes only and does not constitute tax or financial advice. Consult a qualified accounting professional before making any tax or financial decisions.

Sources & References

  • Canada Revenue Agency, Line 21900 Moving expenses: canada.ca
  • Canada Revenue Agency, Form T1-M Moving Expenses Deduction: canada.ca
  • Government of Canada, Income Tax Act, Section 62 & 248(1): laws-lois.justice.gc.ca
  • Canada Revenue Agency, Keeping records: canada.ca
  • Revenu Quebec, Form TP-348 Moving Expenses: revenuquebec.ca
  • Canada Revenue Agency, Labour Mobility Deduction: canada.ca