For employees that had to work from home in 2020 due to COVID-19, you may have incurred expenses from having to maintain a home office. Things like rent, condominium fees, home internet, telephone, office supplies (such as pens, sticky notes, folders, printer toner, paper, for example), and utilities, are just some of the expenses that come to mind. If you were to add up the percentage of those expenses that were used for your employment over the months, it probably adds up to several hundred dollars. Well there is good news for taxpayers. For the 2020 tax year, CRA is allowing employees that were required to work from home due to COVID-19 to claim a flat rate of $400 in employment expenses. You don’t need any supporting documents. There is a new tax form that you will have to complete to claim the deduction called the T777S – “Statement of Employment Expenses for Working at Home Due to COVID-19” . Note: This is a tax deduction not a tax credit. You can deduct the amount from your income tax payable to reduce your tax liability but you do not get a tax credit. The form is available for download on the Canada Revenue Agency website at
https://www.canada.ca/en/revenue-agency/services/forms-publications/forms/t777s.html
Who can claim the deduction? If you had to work more than 50% of the time from home for a period of at least 4 consecutive weeks in 2020 due to COVID-19 you can claim the deduction. It is calculated as a flat rate of $2 for each day worked at home during the 4 week period, plus any other days you worked at home, up to a maximum of $400.00.
How is this different from the regular employee expense deduction? It’s different because regular employment expenses for salaried and commissioned employees have to be approved by your employer and signed off on a T2200 “Declarations of Conditions of Employment Form”.
https://www.canada.ca/en/revenue-agency/services/forms-publications/forms/t2200.html
For the 2020 tax year, employees can claim up to $400 in expenses without a signed T2200 from their employer.
What if my expenses exceed the $400.00 flat rate? Can I claim the extra expenses? Yes. You will have to get your employer to sign the T2200 “Declaration of Conditions of Employment Form”. There is a calculator on the CRA website to help you calculate your allowable expenses.
CRA Calculator:
For more detailed information about how to claim home office expenses if you were an employee, visit the Canada Revenue Agency website.