What is the T2200 form?
Some employees can claim certain employment expenses on their Income Tax and Benefit Return if the employer provides them with the T2200 Declaration of Conditions of Employment form. The form will indicate the period of employment when you can claim the expenses and the type of expenses you are eligible to claim.
Who is the T2200 tax form designed for?
Use this form if your employer requires you to pay expenses to earn your employment income. The form should be approved and signed by your employer. Your employer needs to fill Part B and sign the Employer Declaration box of the T2200 tax form. The expenses can be deducted on line 22900 of your Income Tax and Benefit Return.
If you have more than one employer, each one has to sign a separate form.
How do I file the T2200 form?
You do not have to submit the T2200 form with your income tax return but you must keep it in case the CRA asks to see it. You will also need to keep a record of all the expenses you are claiming in case CRA asks for copies.
However, you will need to fill the T777 Statement of Employment Expenses form to calculate your expenses on the tax return. Also, you will need to fill the TL2 Claim for Meals and Lodging Expenses if you are a transport employee. If you are claiming a GST/HST rebate, you will have to submit the GST/HST Rebate Application. All these forms have to be submitted with your tax return.
What are the eligible expenses I can claim?
Your eligible expenses are the ones approved by your employer only regardless of whether or not you paid more out of pocket to earn your income. The deductible expenses are:
- Accounting and legal fees: you can deduct legal fees you paid to establish the right to collect salary under the T2200. You can also claim the fees you paid for an accountant to file your T777 with your return.
- Advertising fees: only if you are a commission paid employee, you can claim expenses paid to advertise for your work. Salary paid employees can’t deduct this amount.
- Allowable motor vehicle expenses: if you have received a non-taxable motor vehicle allowance and have expenses in excess of the allowance, you can deduct these expenses. you can also claim a capital cost allowance for the vehicle you use to earn income. Check this link for more details on which motor vehicle expenses you can claim with the T777 form.
- Food, beverages expenses: you can claim the costs of your meals if you were required to be away from your home for 12 hours or more. You must be away from the municipality area you live in. you can claim 50% of the costs of the meals.
- Entertainment expenses: only commission paid employees can deduct 50% of the costs of food, beverages, and tickets paid to entertain their clients. These expenses cannot include membership fees to any clubs or expenses to maintain or use a yacht, camp, or golf course.
- Lodging: If your employer required you to travel, you can claim the lodging expenses.
- Parking: only commission paid employees can deduct parking expenses that they incurred while earning income. You cannot deduct parking fees paid at the employer’s office location, only the fees while meeting a customer or conducting work away from the office location are eligible.
- Special clothing: generally clothing is not deductible if you can wear the same outfit in any other event such as suits and dresses. However, if your employer requires you to purchase a unique costume or shoes that cannot be used on any other occasion, you can deduct these expenses.
- Tools: only if you are a tradesperson or an apprentice mechanic, you can deduct the costs of the tools you bought for work.
- License: if you require to renew your license to work, such as a real state license, you can deduct the fees.
- Computer, cellphones, and other equipment: you cannot deduct these costs if you buy the equipment. However, if you lease them, you can deduct the leasing costs related to your work. The cellphone air time is deductible, but the activation fees and internet access fees are not.
- Office rent or home office expenses: if you are required to work from home, you can deduct the house expenses related to the area you use to earn income. With the T2200, you can deduct the heating, utilities, and repairs costs. Only if you are a commission paid employee, you can also deduct the insurance and property taxes related to the area you use. The mortgage interest and the CCA value of the home are not eligible with the T2200 form.
- Training costs: if you are required to pay for courses to perform your job, you can deduct these expenses.
- Medical underwriting fees: only if you undergo specific exams to underwrite your customers’ risks, you can deduct these expenses as employment expenses. Any other medical expenses should be claimed as a non-refundable tax credit on line 33099.
- Travel cost: you can deduct the cost of travel fares to earn income if you are a commission paid employee.
Salaried and commissioned employees who reside in Quebec should complete the TP-64.3-V form and signed it by their employers.
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