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  • Peter Wiesner

Simplified Home Office Claims $2 a day! Lots of Rules for small savings in detailed calculations!


On December 15, 2020, the CRA released details on new methods to claim home office expenses.


The update includes:

-New temporary flat rate method

-New options to claim the actual amounts you paid

-New eligible expenses


NEW TEMPORARY FLAT RATE METHOD

The new temporary flat rate method simplifies your claim for home office expenses. You are eligible to use this new method if you worked more than 50% of the time from home for a period of at least four consecutive weeks in 2020 due to the COVID-19 pandemic. You can claim $2 for each day you worked from home during that period plus any additional days you worked at home in 2020 due to the COVID-19 pandemic. The maximum you can claim using the new temporary flat rate method is $400 (200 working days) per individual. Since this is a deduction in your taxes the value of $400 in Ontario at 53.53% is $214.12 and look at the work involved.


Eligibility


Each individual working from home who meets the eligibility criteria can use the temporary flat rate method to calculate their deduction for home office expenses. This means multiple people working from the same home can each make a claim.


This method can only be used for the 2020 tax year.


or


NEW DETAILED METHOD

You are eligible to claim a deduction for home office expenses for the period you worked from home, if you meet all of the criteria:


you worked from home in 2020 due to the COVID-19 pandemic or your employer required you to work from home


you worked more than 50% of the time from home for a period of at least four consecutive weeks in 2020


have a completed and signed Form T2200S or Form T2200 from your employer


the expenses are used directly in your work during the period - see listing below.


Changes to the process


The CRA:


created a simplified Form T2200S and Form T777S


-created a calculator to help you claim the home office expense deduction that you are entitled to claim

-will accept an electronic signature on the Form T2200S and Form T2200 to reduce the necessity for employees and employers to meet in person (applies to the 2020 tax year only)


In addition to your home office costs, supplies can be claimed as well.


NEW ELIGIBLE EXPENSES FOR SUPPLIES AT HOME


The CRA has released a 59 item list of items that individuals may have been considering deducting, which indicates what specifically would be deductible, and what would not. The eligibility list is broken down by destructibility for commissioned sales persons and employees.


Common home office supplies


Can it be claimed??

Blue light eye glasses

  • No | Salaried employees No | Commissioned employees

Briefcase

  • No | Salaried employees No | Commissioned employees

Calculator

  • No | Salaried employees No | Commissioned employees

Capital cost allowance

  • No | Salaried employees No | Commissioned employees

Chair

  • No | Salaried employees No | Commissioned employees

Charging or connecting cables

  • No | Salaried employees No | Commissioned employees

Coffee supplies

  • No | Salaried employees No | Commissioned employees

Computer, laptop, or tablet - lease

  • No | Salaried employees Yes | Commissioned employees

Computer, laptop, or tablet - purchase

  • No | Salaried employees No | Commissioned employees

Computer, laptop, or tablet - cases or bag

  • No | Salaried employees No | Commissioned employees

Computer, laptop, or tablet - protection plans

  • No | Salaried employees No | Commissioned employees

Computer monitor

  • No | Salaried employees No | Commissioned employees

Computer mouse

  • No | Salaried employees No | Commissioned employees

Desk

  • No | Salaried employees No | Commissioned employees

Electrical room heater or fan

  • No | Salaried employees No | Commissioned employees

Envelopes

  • Yes | Salaried employees Yes | Commissioned employees

Ergonomic examination

  • No | Salaried employees No | Commissioned employees

Ergonomic foot rest

  • No | Salaried employees No | Commissioned employees

External hardrive

  • No | Salaried employees No | Commissioned employees

Fax machine - lease

  • No | Salaried employees Yes | Commissioned employees

Fax machine - purchase

  • No | Salaried employees No | Commissioned employees

Folders

  • Yes | Salaried employees Yes | Commissioned employees

Garbage or recycle bins

  • No | Salaried employees No | Commissioned employees

Graphing equipment

  • No | Salaried employees No | Commissioned employees

Headset or headphones

  • No | Salaried employees No | Commissioned employees

Highlighters

  • Yes | Salaried employees Yes | Commissioned employees

House-plants

  • No | Salaried employees No | Commissioned employees

Ink cartridges

  • Yes | Salaried employees Yes | Commissioned employees

Keyboard or wireless keyboard

  • No | Salaried employees No | Commissioned employees

Lamps

  • No | Salaried employees No | Commissioned employees

Laptop stand

  • No | Salaried employees No | Commissioned employees

Microphone

  • No | Salaried employees No | Commissioned employees

Mouse pad

  • No | Salaried employees No | Commissioned employees

Note-books

  • Yes | Salaried employees Yes | Commissioned employees

Online subscriptions

  • No | Salaried employees No | Commissioned employees

Paper clips or binder clips

  • Yes | Salaried employees Yes | Commissioned employees

Paper shredder

  • No | Salaried employees No | Commissioned employees

Pens or pencils

  • Yes | Salaried employees Yes | Commissioned employees

Power bar or surge protector

  • No | Salaried employees No | Commissioned employees

Printer

  • No | Salaried employees No | Commissioned employees

Printer paper

  • Yes | Salaried employees Yes | Commissioned employees

Protective mat for office floor

  • No | Salaried employees No | Commissioned employees

Router - purchase

  • No | Salaried employees No | Commissioned employees

Safe, lock box, or lock

  • No | Salaried employees No | Commissioned employees

Scanner


* No | Salaried employees No | Commissioned employees

Smart speaker

  • No | Salaried employees No | Commissioned employees

Software and Speakers

  • No | Salaried employees No | Commissioned employees

  • No | Salaried employees No | Commissioned employees

Specialty paper (for example: graph paper, tracing paper)

  • Yes | Salaried employees Yes | Commissioned employees

Specialized printer (for example: large scale, high resolution)

  • No | Salaried employees No | Commissioned employees

Stamps or postage

  • Yes | Salaried employees Yes | Commissioned employees

Stationery items

  • Yes | Salaried employees Yes | Commissioned employees

Sticky notes

  • Yes | Salaried employees Yes | Commissioned employees

Storage containers or cabinets

  • No | Salaried employees No | Commissioned employees

Television

  • No | Salaried employees No | Commissioned employees

Toner

  • Yes | Salaried employees Yes | Commissioned employees

USB drive

  • No | Salaried employees No | Commissioned employees

Voice assistant

  • No | Salaried employees No | Commissioned employees

Webcam

  • No | Salaried employees No | Commissioned employees

Explanatory landing page

New T2200S

New Form T777S

Conclusion;


Thus, lots of rule changes for working at home with minimal value once you consider your time to do the following; obtain the T2200S, track your costs, complete forms, and then apply your marginal tax rate.


If you have any questions or comments, please email peter@taxhome.net or call 905-898-3355.


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