Operations
Can I write off Inventory & Cost of Goods Sold in Canada?
YES
Explanation
The cost of products you purchase to resell is deductible. For tax purposes, you calculate Cost of Goods Sold (opening inventory + purchases − closing inventory). Raw materials for products you manufacture are also included.
💡 Pro Tip
Do a physical inventory count at year-end (Dec 31) and keep a record. The CRA can ask for this if you're audited.