The pandemic has many people working away from their normal place of business. 

If you are using your home as a temporary work space, you may qualify for a flat rate $500 tax deduction on your 2021 return.

You will have to meet certain criteria in order to get the benefit.

• had to have worked at least 50% of the time for at least four consecutive weeks in 2021.
• claimed home office expenses only and no other employment expenses
• were not fully reimbursed by their employer for all of their home office expenses

The simplified guidelines introduced in 2021 (2020 taxation year) for employees working from home due to COVID-19 have been extended.

The temporary flat rate method allows eligible employees to claim a deduction of $2 for each day worked from home in 2021 due to COVID-19, up to a maximum of 250 days or $500.

If you use the detailed method, employees can claim the employment portion of the actual home office expenses paid. To calculate the deduction, employees have to figure out the total of their eligible expenses from rent, utilities, etc. They must then receive a signed T2200 or T2200S form from their employer and complete the detailed method section of Form T777S.

Download my worksheet to help you with this.

For more details on this tax benefit, visit CRA's website. This will provide you with the forms you'll need to fill out and the difference between both options. You can also visit the CPA's website for more information.

Sources used:

https://www.cpacanada.ca/en/business-and-accounting-resources/taxation/blog/2022/february/employee-home-office-expenses-2021

https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/about-your-tax-return/tax-return/completing-a-tax-return/deductions-credits-expenses/line-22900-other-employment-expenses/work-space-home-expenses/how-claim.html#h-2