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Are you eligible to claim home office expenses from working from home on this year’s tax return?

Are you eligible to claim home office expenses from working from home on this year’s tax return?

If you worked from home during 2020 you may be entitled to a tax savings.

Due to the exceptional circumstances of the past year, the Canada Revenue Agency has changed the rules for how to claim a deduction on your 2020 personal taxes for working from home. Depending on your eligibility, there are two methods by which you may be able to claim home office expenses: the Temporary Flat Rate Method and the Standard Detailed Method.

Temporary Flat Rate Method

Employees must meet the following conditions for this method:

    • Employee worked from home in 2020 due to the pandemic;
    • Employee worked from home more than 50% of the time for at least four consecutive weeks;
    • Employee is claiming home office expenses only (no other employment expenses); and
    • Employee was not fully reimbursed by the employer for all of their home office expenses.

If the above is met, the employee can claim $2 per day for a maximum of 200 days (max claim $400). The use of this method eliminates the need to keep receipts or to receive a form from your employer.

Standard Detailed Method

Employees must meet the following conditions for this method:

    • Employee received a signed T2200 (original conditions of employment form) or T2200S (New COVID conditions of employment form) from their employers; and
    • Worked from home in 2020 due to the pandemic OR were required to work at home by their employer
    • Were required to pay for home office expenses or expenses used directly in their work; and either
      • The employee worked more than 50% of the time at home for at least four consecutive weeks; or
      • The home office is used only to earn employment income and used regularly and continually to meet clients or customers in the course of job duties.

Eligible expenses include office supplies, utilities, internet access fees, repairs, maintenance, and rent – with some additional expenses allowed for commissioned employees.

Mortgage payments (both interest and principal portions), internet connection fees, furniture, and other capital expenses (such as computers, monitors, office decorations etc.) cannot be claimed.

If you have any questions regarding your eligibility or how to claim home office expenses, please feel free to contact us. We would be happy to help.