If you are an employee who worked from home due to the COVID-19 pandemic, you may be eligible to claim a deduction for home office expenses on your 2020 T1 Personal Income Tax Return. The CRA has introduced a new temporary flat rate method to make claiming the deduction even easier.
Temporary Flat Rate Method
The temporary flat rate method simplifies calculating your home office expense deduction by providing a daily rate, to be multiplied by the number of days you worked from home. The daily rate is $2 for each day you worked from home, to a maximum of 200 working days, or $400.
To use the temporary flat rate method, you must meet all of the eligibility criteria:
- You worked from home due to the COVID-19 pandemic. This applies if your employer required you to work from or provided you the choice, and you chose to work from home.
- You worked from home more than 50% of the time, for a minimum of 4 consecutive weeks.
- You are not claiming any other employment expenses.
- You were not reimbursed by your employer for all your home office expenses. If you were reimbursed for only some, you are considered to still meet the criteria.
Calculate your Claim
Count the number of days you worked from home.
What is considered a work day?
- Any day you worked full-time OR part-time from home
- NOT vacation days
- NOT sick days
- NOT any other day off
Calculation = Number of days worked from home x $2 (maximum $400).
Each individual employee working from home who meet the criteria case use this method, even if there are multiple employees on the same home.
This method may only be used for the 2020 tax year.
Traditional Detailed Method
If you do not qualify for the simplified temporary rate method, you may still be eligible to claim some home office expenses using the traditional detailed method. To do so, you must:
- Obtain a completed and signed Form T2200, or the new T2200S from your employer.
- Determine the size and use of your work space to calculate your claim.
Under the traditional detailed method, you claim a percentage of the actual expenses you paid. The eligible expenses differ based on whether you ae a salaried or commissioned employee.
More information on both the claim methods and details of how to claim each can be found on the CRA website using the following link. The site even offers interactive calculators to assist you in calculating your claim amounts.
Written by: Laura Kristian, CPA