Do you want more tax savings this year? You may be entitled to more deductions if you worked from home in 2020.
Work From Home Tax Savings
Working from home may increase your ability to take deductions against your income on your tax return – not just home office expenses.
At KATA Accounting Solutions PC, we’ve always been work-from-home professionals; well, more like work-from-anywhere professionals. There are a lot of benefits to working from home, and some challenges too. My favourite benefit is the commute – measured in steps! My biggest challenge is making sure I separate work from home life as it’s very easy to keep working.
You may be eligible to claim employment expenses including home office expenses if you regularly work from home. And with the COVID-19 pandemic, the government recognized that many people ended up working from home in 2020. There are three ways to claim work-from-home expenses on your 2020 Canadian tax return.
The Simple Method of Tax Savings for COVID
You can take $2/day as a basic deduction up to a maximum of 200 days. This deduction requires no additional forms. This is the fastest and easiest way to get the deduction.
The Detailed Method of Tax Savings for COVID
You can deduct more work-from-home expenses if your employer has provided you with a T2200S. You usually get a higher deduction. Sometimes, the Simple Method provides a higher deduction, and it’s best to check both. Please contact KATA today if you need help calculating which will yield the greatest return.
The Detailed Method of Tax Savings for Regulars
Ask your employer for a T2200 every year. You can use it to deduct many home costs against your employment income. Working from home has many benefits for employers and employees, including tax savings.
You can claim many home expenses depending on your situation. However, there are different rules for employees and self-employed people. Commissioned employees can deduct some expenses salaried employees can’t. The self-employed can deduct several sets of expenses employees can’t. Contact Us to learn more.
Are you trying to get your taxes organized? Have you been affected by the Coronavirus Pandemic? Did you work from home in 2020? Reach out to us! Request our Personal Tax Bookkeeping Template. Each tab covers a different section of deductions and has drop-down categories for easy sorting. Ask for one by Contacting Us today!
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