Did You Work From Home During The Pandemic?
Claiming Your Home Office Expenses
The Canada Revenue Agency (CRA) has introduced two methods for claiming Home Office expenses for 2020. Both methods apply to employees who worked from home for more than 50% of the time over at least 4 consecutive weeks due to Covid-19.
This is a brief rundown of how these methods work. When you have your annual appointment with Bruce, he will ensure you receive the deductions you’re entitled to and file them on your behalf! Make your appointment.
Method 1: Temporary Flat Rate Method
Employees claim $2 for each day they worked from home up to a maximum of $400. In other words, 200 working days.
For this method, you don’t have to keep supporting documents that track expenses, and a T2200S is NOT required.
Do You Qualify?
- You worked from home in 2020 due to the pandemic whether as a requirement or as a choice given by your employer
- You worked over 50% of the time from home for at least 4 consecutive weeks in 2020
- You are only claiming home office expenses and no other employment expenses in 2020
- You were not reimbursed by your employer for all of your home office expenses
*You must meet all the above criteria to be eligible to use the Temporary Flat Rate Method.
Calculating your deductions is simple!
- You don’t need to calculate the size of your work space within your home
- You don’t need supporting documents
- Your employer does NOT have to complete or sign the new T2200S form.
What is the T2200S Form?
Form T2200S – Declaration of Conditions of Employment for Working at Home Due to COVID-19. It’s a simplified version of Form T2200 which is the Declaration of Conditions of Employment (used for the Detailed Method explained below).
Method 2: Detailed Method
This method requires employees to use the new T2200S form and allows you to claim the actual value of your home office expenses with supporting documentation.
You may NOT deduct the following:
- Mortgage interest,
- Capital expenses or depreciation,
- New ergonomic chair(s),
- Widescreen monitor(s),
- Headset(s) or earphones
Remember, if your workspace is also a kitchen or a family room, you can only claim the % of time you work in it. That makes the $2 / day quite generous.
Do You Qualify?
- You worked from home in 2020 due to the pandemic
- Your employer required you to work from home
- You were required to pay for expenses related to the work space in your home
- You are only claiming home office expenses and more other employment expenses in 2020
- You worked over 50% of the time from home for at least 4 consecutive weeks in 2020 OR you only use your work space to earn employment income (i.e. a space in your home dedicated as an office – not working in the kitchen or living room).
- Your expenses are used directly in your work
- You have a completed T2200S Form OR a T2200 Form from your employer
You may not use this method if you are claiming any other employment expenses on line 22900. If you are claiming other employment expenses on line 22900, you will need to use Form T777.
You MAY Deduct the following:
- Rent
- Utilities
Employees who earn commissions can also deduct:
- Home insurance,
- Property taxes,
- Leasing costs for laptops, fax, cellphones, and other equipment that relates to earning income.
We Submit These Forms and Documents For You!
When you have your annual tax appointment, we will go over your unique situation to help you determine the best option for you and file these Forms on your behalf.