YOU ASK:

Is my travel insurance tax deductible?

WE ANSWER:

Not always.

There are, however, some instances where you can deduct a portion of your travel insurance premiums from your payable tax amount.

If you are employed, you may use a portion of the premium that is used to pay for emergency medical coverage.
If you are self-employed, you may use a part of the travel health insurance as a tax deduction. The trip, however, should be for business purposes only, that is, it is related to your work as a self-employed business person.

Essentially, if you are self-employed, all business-related costs can be tax deductible. However, if you are travelling for both business and pleasure, you may have to indicate which portion of the trip is for business and which portion of the trip is for pleasure. The amount you can write off depends on what portion of the trip is related to one's business.

What Trips Are Considered Work-Related So That You Can Deduct Your Travel Insurance?

This may include travel that is related to the work that you do, such as visiting a client, or traveling for a seminar, a conference, a business convention or a training course.

You can also deduct travel insurance expenses for attending industry promotions and educational training courses, as long as this business promotion is for your work and not classified as entertainment (such as instances where more than light refreshments are provided). The training course should also be specific to your job as a self-employed individual.

To illustrate, if you are a travel agent and you attend a course on electronic ticketing, the travel insurance may be tax deductible. If you are a travel agent and you are traveling to attend a course on self-management or accounting, this may not be considered tax-deductible, as the course is too general and not directly related to your business as a travel agent.

Finally, have in mind that the portion of the travel insurance premium that covers things that are generally private in nature may not be tax-deductible. This includes coverage for loss of baggage.

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