Employees guide to claiming home office expenses on your 2020 T1 return

The Change

Prior to 2020, claiming a home office required you to meet certain eligibility requirements and obtain a signed Form T2200 from your employer.

Due to the COVID-19 pandemic, CRA has simplified the process for both employees and employers.

There are two methods to calculating your eligible home office expenses. Including, a new Temporary Flat Rate Method. Under the new Temporary Flat Rate Method, you do not have to calculate the size of your work space, keep supporting documents or ask your employer to sign Forms T2200 or T2200s.

The methods and eligibility requirements

Temporary Flat Rate Method

– You worked from home in 2020 because of COVID-19. It can be either your choice or your workplace’s new policy.
– For at least 4 consecutive weeks in 2020, during that period, more than 50% of your work time was at home.
– You are not claiming any other employment expenses on your tax return.
– Your employer did not reimburse all of your home office expenses. If some of them are reimbursed, you are still eligible.

Detailed Method

– You worked from home in 2020 because of COVID-19 or because of workplace requirement regardless of COVID-19.
– You were required to pay for expenses related to your work at home, except for those that were reimbursed.
– For at least 4 consecutive weeks in 2020, during that period, more than 50% of your work time was at home OR Your workspace is regularly and continuously used for meeting clients, and exclusively used for earning employment income.
– The expenses you are going to claim are directly related to your work.
– You have a completed and signed copy of Form T2200S (if due to COVID-19) or Form T2200 (if not due to COVID-19).

What can be claimed

Temporary Flat Rate Method:

$2 for each day your worked from home up to $400.

Detailed Method:

-(Salaried Employees) electricity, heat, water, utility portion of condo fee, internet, maintenance, and rent.
-(Commission employees) home insurance, property tax, lease of work-related electronics, and expenses mentioned above.
-For the detailed method, you will have to provide your accountant with the square footage of your home and the square footage of your home office.

For more information, please contact Kevin Fu at kfu@mccannllp.com or by phone at 647-508-5555 Ext. 109.

Book your appointment today

McCann and Associates LLP

1 St Clair West, Suite 402
Toronto, Ontario M4V 1K6
Tel: (647) 508-5555
Fax: (647) 508-5556