Expenses Incurred from Working From Home

Can an Employee Deduct Them?

Now that working from home has become a common and will be here for the foreseeable future. Employees are incurring costs building up an office in their home, so the costs must be reviewed for eligibility. Employers need to support employees to ensure the tax reductions can be realized. We help you understand your work from home expenses and determine how you can deduct them.

Once you meet the requirements, Home Office Expenses can be deducted from income. This would have to be stipulated in the employment agreement that the costs are the responsibility of the employee.

  • The deduction of Office Expenses and Supplies will be in effect if the employee works more than 50% from its home office.
  • Form T2200 must be filled out by Employer and Employee, and it states that these costs are necessary for the completion of the employees’ duties.
  • If the costs associated with home office expenses attract HST/GST, then it can be applied for the rebate of tax related to the amount of HST/GST amount.
  • During the COVID-19 period, any items purchased for the employee will not attract tax for the employee up-to $500.

At Chartered Professional Accountants, our specialized understanding of work from home expenses, individual and corporate taxes, as well as experience working with self-employed contractors and small businesses that we can help create and maintain the necessary paperwork for monthly income and expenses for tax preparation and submission. Our consultants in Toronto discuss your business tax and accounting needs to determine the best course of action for you.

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