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Arthur Rubin
Arthur Rubin, Tax Preparer
Category: Canada Tax
Satisfied Customers: 1561
Experience:  Tax preparer with 23 years experience, including US/Canada tax returns.
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I am a Canadian consultant direct sales/network marketing

Customer Question

Hello, I am a Canadian consultant for a direct sales/network marketing company in the health and wellness/skincare industry.
Some of my personal orders include products that I showcase during presentations, as well as lend out to prospects to try in their homes for a few days.
Where can I enter these deductions on T2125?
Would it be under COGS (line 8340, Purchases during the year, or under another section in Expenses?)
Submitted: 1 year ago.
Category: Canada Tax
Expert:  Arthur Rubin replied 1 year ago.

Products you show during presentations best fit under "Supplies" (line 8811). However, if such products were to be sold to customers, they would become inventory, which you should already know how to report. Sending products to customers (without payment) would probably be a "business gift", and a plausible advertising expense.

I don't see how a presentation could fall under "Cost of Goods Sold"; your efforts with the demonstrations don't go into a product sold to customers.