COVID-19 Tax Considerations for Home Office Expenses

2020 and the COVID-19 pandemic has had numerous impacts on business and its employees for the past nine months. For some businesses and their employees, working from home or remote working became a new reality.

On December 15, 2020, CRA announced administrative changes to the employee’s deduction for home office expenses, including:

1. Shorter qualifying period if working from home due to Covid-19

• Employees who worked from home more than 50% of the time over a period of a least four consecutive weeks in 2020 due to COVID-19 can claim the home office expenses deduction for 2020.

2. Simplified forms for employees working from home due to Covid-19

• T2200S Declaration of Conditions of Employment for Working at Home Due to COVID-19

• T777S Statement of Employment Expenses for Working at Home Due to COVID-19

3. Temporary flat rate for 2020 for employees working from home due to Covid-19

• Temporary flat rate of $2 for each day they worked at home in the new qualifying period, plus any other days they worked from home in 2020 due to COVID-19 up to a maximum of $400.

• Under this new method, employees will not have to get Form T2200 or Form T2200S completed and signed by their employer.

4. Were you required to work from home?

• If you were not required to work from home, but your employer provided you with the choice to work at home because of the COVID-19 pandemic, then the CRA will consider you to have worked from home due to COVID-19.

5. New eligible expense

• Home internet access fees can now be claimed.

Further details on home office expenses for employees are available on CRA website here.

For any questions specific to eligible COVID-19 claims or other tax-related items, contact any member of our Tax Team.