Tax time is just around the corner, and many Canadians are wondering what they can claim as home office deductions. In the past, the government required a specific work-from-home tax form to be filled out by your employer before you could claim home office expenses. Even then, there were strict limits on what you could and could not claim.
Given the unique circumstances of 2020, Revenue Canada has relaxed the guidelines for home office deductions. The new temporary flat rate method is simpler for claimants and simpler for employers as well.
Eligibility Criteria
To use the new flat rate deduction method, the government requires you to have worked from home in 2020 due to the Covid-19 pandemic. In addition, you must have worked more than 50% of the time from home for at least four consecutive weeks in 2020. View the full eligibility details on the Revenue Canada website.
Temporary Flat Rate Method
If you meet the eligibility criteria, you can claim $2 for each day you worked from home to a maximum of $400 (200 working days). You’re not required to have a signed Form T2200S or Form T2200, and you do not need to provide receipts or calculate the size of your work space. The CRA has created a claim comparison page to calculate the best method for calculating your deduction.A tax professional can help you understand the new tax deductions for home offices and ensure you’re properly claiming the amount you deserve. Remote work options appear to be a permanent part of our economy for the time being. To update or design your own home office, contact the furniture experts at Source.
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