On December 15, 2020, 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.
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.
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
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
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)
New Eligible: Expenses
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 deductibility for commissioned sales persons and employees.