Moving Expenses Deduction: Tax Court of Canada Allows Appeal in De Kruyff v. The King (2025 TCC 116)

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August 29 2025
M. Hanif Shaikh

Background

The Tax Court of Canada recently released its decision in De Kruyff v. The King, 2025 TCC 116, a case that clarifies the rules surrounding moving expenses under the Income Tax Act. The decision highlights when Canadians can deduct moving costs after relocating for employment.

Mr. De Kruyff, a financial professional, accepted a new job in Toronto in January 2020. To be closer to his workplace, he moved from Newmarket to Mississauga. In doing so, he incurred nearly $130,000 in moving-related expenses, which he claimed on his tax return.

The Minister of National Revenue denied the deduction, leading to an appeal to the Tax Court.

Key Issue

The central question before the Court was:

👉 Was Mr. De Kruyff entitled to deduct moving expenses, given the relatively short distance between his old and new homes?

The Law on Moving Expenses

Under section 62 of the Income Tax Act, a taxpayer may deduct moving expenses if:

1. The move was made to start a new job or carry on a business at a new location, and
2. The new home is at least 40 kilometres closer to the new place of work.

Court’s Findings

• The parties agreed that the move brought Mr. De Kruyff 26 kilometres closer to his workplace.
• The relocation was clearly linked to his new employment.
• The Court emphasized that the 40-kilometre rule is a factual calculation, and in this case, it was satisfied.

As a result, the Tax Court allowed the appeal, granting Mr. De Kruyff the ability to deduct his substantial moving expenses.

Why This Matters?

This decision reinforces the importance of two factors when claiming moving expenses:

1. Distance test (40 km rule): Taxpayers must carefully measure the shortest public route between their old and new residences to the new workplace.
2. Purpose of the move: The move must be directly related to starting new employment or carrying on a business.

For professionals and families relocating within the Greater Toronto Area—or anywhere in Canada—this case demonstrates that even relatively short-distance moves can qualify, as long as the 40 km threshold is met.

Takeaway for Taxpayers

If you are moving for work, keep detailed records of:

• Employment offers or contracts,
• Moving invoices and receipts, and
• Distance calculations between old and new residences.

These details are often decisive in resolving disputes with the Canada Revenue Agency (CRA).