With millions of Canadians working from home as a result of the COVID-19 pandemic, many people had to purchase new computer equipment, desks and other supplies to help facilitate working from home. If you are an employee spending money to outfit a home office, the big question is what – if any expenses – will you be able to claim come tax season. The answer to this question is complex and depends on multiple factors.
To start, one of the eligibility conditions is that you primarily work from home. This means that more than 50 percent of your working time must be spent there, or it must be a space designated solely for your work and used on a regular and continuous basis for meeting customers or clients.
Next, the amount you can claim is based on how much of your home or apartment is being used as a workspace. For example, if you use around 20 percent of your home as workspace and it is used for half the year, then this accounts for 10 percent of the yearly expenses that can be claimed.
Some of the expenses that can be partially claimed while running a home office are utilities, property taxes, house insurance, the heating and cooling of your house, internet fees, and cellphone. It should also be noted that you can also claim 100 percent of any items such as paper, pens, laptops, printers and ink/toner that were purchased for work purposes.
Most importantly, home offices are one of the items on the CRA’s audit list. It is definitely very important for you to keep all of your receipts, bills and statements that are associated with your home office, especially those that you are claiming.
If you want to apply for these deductions come tax season, you will need your employer to fill out a T-2200 form. This form is a Declaration of Conditions of Employment issued by the Canada Revenue Agency.
You can find a copy of the form here – https://www.canada.ca/en/revenue-agency/services/forms-publications/forms/t2200.html
Your employer must fill out the form and declare that they are not reimbursing you for your expenses in order to be eligible for the deduction.
This is by no means a definitive answer of how or what can and can not be claimed while working from home. If you need help sorting through your options, Keenans Accounting Service is here for you. Just give us a call at 705-526-7628 to arrange a consultation by phone or via Zoom meeting. We are practicing social distancing while working remotely and with reduced staff so please leave us a message and we will get back to you as soon as possible.