After Tax Canada / Moving expenses tax deductionVersion française
Moving expenses tax deduction calculator (2026)
Moving expenses are a deduction, not a credit: every deductible dollar cuts your taxable income by a dollar. But only the income you earn at the new location is deductible in a year, and the move must pass the 40-kilometre test. Enter your income at the new location and your expenses to see the exact tax saving, federal and provincial, for every province.
The deduction is capped at the income you earn at the new location in the year: employment or self-employment income (for students, the specific student income the rules refer to). Enter that income here, not your total income for the year.
Movers and storage, travel to the new home, up to 15 days of temporary meals and lodging, lease cancellation, and the cost of selling the old home. The calculator assumes the move passes the 40-kilometre test below.
Ontario · 2026
$3,584$3,584 back on $12,000 of moving expenses
Effective saving rate: 29.9%
$299 a month back
What you can deduct
| Moving expenses paid | $12,000 |
| Income at the new location (the cap) | $100,000 |
| Deductible amount | $12,000 |
| Excess, carried forward to next year | $0 |
Your expenses are fully deductible: you paid less than your income at the new location, so the whole amount is deductible this year.
Where the savings come from
| Federal tax saved | $2,460 |
| Provincial tax saved | $1,124 |
| Total tax saved | $3,584 |
| What the move really costs you | $8,416 |
Moving expenses are a deduction from income, not a credit: they reduce your taxable income, so the tax you save is your income tax on your income minus your income tax on (income minus the deductible amount). CPP/QPP and EI are not reduced by the deduction.
The expenses leave your pocket, then the tax savings come back as a refund (or smaller balance owing) when you file, so the out-of-pocket cost is the expenses minus the savings.
How the deduction works
The move must be an eligible relocation: your new home is at least 40 kilometres closer to the new work location (or full-time post-secondary school) than your old home was, measured by the shortest public route. Claim it on Form T1-M and line 21900 of your federal return, one T1-M per move. Eligible expenses include movers and storage, travel to the new home, up to 15 days of temporary meals and lodging near the old or new home, cancelling the lease on the old home, and the cost of selling the old home, including the real estate commission, legal fees, and a mortgage prepayment penalty, plus up to $5,000 of costs to maintain a vacant old home while it is listed for sale. If the old home was sold because of the move, the legal fees and land-transfer-type taxes on buying the new home are also eligible. Moving expenses an employer reimburses or pays directly are a taxable benefit, not a deduction, and are not included here. A full-time student qualifies under the same 40-kilometre test, but the deduction can normally be used only against taxable scholarships, fellowships, bursaries, certain prizes, or research grants.
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Worked examples: 2026
| Income · province | Expenses | Deductible | Tax saved |
|---|---|---|---|
| $100,000 · ON | $12,000 | $12,000 | $3,584 |
| $75,000 · ON | $10,000 | $10,000 | $2,979 |
| $100,000 · QC | $12,000 | $12,000 | $4,328 |
| $90,000 · BC | $8,000 | $8,000 | $2,222 |
| $15,000 · ON | $20,000 | $15,000 | $55 |
2026 tax tables · verified 2026-09-20 · how we calculate
FAQ
How much tax do I save on $12,000 of moving expenses?
In 2026, on a $100,000 Ontario income at the new location, $12,000 of eligible moving expenses saves $3,584 in income tax ($2,460 federal + $1,124 provincial). The whole $12,000 is deductible: it is below the income earned at the new location, so nothing is capped. The $12,000 move really costs you $8,416 out of pocket.
How does the moving expenses deduction work?
Moving expenses are a deduction from income, not a tax credit: they reduce your taxable income dollar-for-dollar, up to the income you earned at the new location in the year. The tax you save equals your income tax on your income minus your income tax on (income minus the deductible amount). Claim it on Form T1-M and line 21900 of your federal return, one T1-M per move. The move must pass the 40-kilometre test: your new home is at least 40 kilometres closer to the new work location (or full-time post-secondary school) than your old home was, measured by the shortest public route.
What moving expenses can I deduct?
Movers and storage, travel to the new home, up to 15 days of temporary meals and lodging near the old or new home, cancelling the lease on the old home, and the cost of selling the old home, including the real estate commission, legal fees, and a mortgage prepayment penalty, plus up to $5,000 of costs to maintain a vacant old home while it is listed for sale. If the old home was sold because of the move, the legal fees and land-transfer-type taxes on buying the new home are also eligible. Costs that are not eligible include new furniture, job search costs, and mail forwarding.
What is the 40-kilometre rule?
The rule does not ask whether you moved 40 kilometres. It compares two distances, both measured by the shortest public route: from your old home to the new work location, and from your new home to that same location. The second distance must be at least 40 kilometres shorter than the first. If your new home is only 30 kilometres closer, the move does not qualify, no matter how far you actually travelled.
What if my moving expenses are more than my income at the new location?
Only the income at the new location is deductible this year, and the excess is not lost: it carries forward to the next year. For example, on a $15,000 Ontario income at the new location with $20,000 of moving expenses, only $15,000 is deductible this year, saving just $55, and the $5,000 excess carries forward. The calculator above shows the carried-forward amount next to the deductible amount.
Do moving expenses reduce CPP or EI?
No. Moving expenses reduce income tax only: CPP/QPP and EI premiums are calculated on your employment earnings and do not change. That is why the savings above come entirely from the federal and provincial tax lines.
How are the savings different in Quebec?
Quebec's higher provincial brackets mean bigger savings: on a $100,000 income at the new location, $12,000 of moving expenses saves $4,328 in Quebec ($2,048 federal + $2,280 provincial) versus $3,584 in Ontario, an effective saving rate of 36.1% instead of 29.9%.
What if my employer paid for the move?
Moving expenses an employer reimburses or pays directly are a taxable benefit, not a deduction: the amount is added to your employment income and taxed, so there is nothing left to deduct. The calculator above is for expenses you paid yourself out of pocket. If your employer paid part of the move and you paid the rest, only the part you paid yourself is deductible, and only up to your income at the new location.