What is the T777-s form?
Salaried and commissioned employees who had to work from home due to COVID-19, can claim home office expenses as employment expenses deduction on line 22900 of the income tax return. You need to complete the T777-s Statement of Employment Expenses for Working at Home Due to COVID-19 to calculate the allowable portion of the expenses.
Salaried and commissioned employees who reside in Quebec should complete the TP-59.S-V form to claim the employment expenses (the link will be updated when RQ releases the form).
Who can use the T777-s form?
If you worked more than 50% of the time from home for a period of at least a month (four consecutive weeks) in 2020 due to COVID-19, you can claim home office expenses using the T777-s form.
This deduction is not available for employees who work from home as part of their work duty regardless of the COVID pandemic.
How much can I claim?
Claim a flat rate of $2 for each day that you worked at home during the 4 weeks’ period, plus any other days you worked at home in 2020 due to COVID-19, up to a maximum of $400. You don’t need supporting documents to claim the flat rate.
If your expenses exceeded the $400, you will need the T2200-s Declaration of Conditions of Employment for Working at Home Due to COVID-19 signed and approved by your employer to use the detailed method on the T777-s form.
What are the eligible expenses I can claim under the detailed method?
Salaried employees can claim common home office expenses include:
- rent paid for a house or apartment where you live (mortgage payment is not eligible)
- electricity, water, heat, or the utilities’ portion of your condominium fees
- maintenance such as minor repairs, cleaning supplies, light bulbs, paint, etc. (capital expenses are not eligible).
- home internet access fees
- office supplies such as stationery items, pens, folders, sticky notes, postage, toner, ink cartridge, etc. (CCA claims are not eligible)
- employment use of a basic cell phone service plan (cell phone devices and license fees are not eligible)
- long-distance calls for employment purposes
Commissioned employees can also claim the following:
- property taxes
- home insurance
- lease of a cell phone, computer, laptop, tablet, fax machine, etc. that reasonably relate to earning commission income (cannot claim the CCA amount of the purchase of theses equipment)
How do I calculate the work-use portion of the expenses?
CRA has created a calculator to estimate your employment expenses for this year. You choose the claimed method then answer the questions to calculate the expenses.
Using the CRA calculator:
- Choose home office expenses you paid due to COVID-19
- Use rent, owned or changed residential under your residential situation
- Choose the type of space you are using: shared or designated office space
- Choose the measurement unit: ft2 or m2
- Enter the Common (shared) space used and the total finished spaces of your home
- Enter the hours of work you performed in the home office space
- The calculator will give you a summary of the home office percentage
- You are required to state the months you worked from home in the calculator
- List the expenses you paid during the work-from-home period. Report $0 under the expenses that do not apply to you.
- Enter you’re the information required from your T4
Marline worked from home due to COVID-19 for 8 months. She used one room in her rented apartment that is 100 ft2 of the total apartment size which is 1200 ft2. She works in the home office for 40 hours every week. Her expenses exceeded the maximum flat rate:
- Utilities: $1,600
- Office supplies: $600
- Long-distance calls: $2,000
- Maintenance to the office space only: $200
- Rent: $8,000
Marlines total expenses = $1,600 + $600 + $2,000 + $8,000 + $200 = $12,400
The home office percentage used was:
- 100 ft2 / 1200 ft2 = 8.33%
- 40 hours / 168 hours (total hours in a week) = 23.81% (use for expenses paid in the office space only)
- Percentage of home use = 8.33 % x 23.81 % = 1.98 % (use for expenses shared with the home)
For expenses that were totally consumed for work, deduct the full expense:
Office supplies + long distance for work only = $600 + $2,000 = $2,600
The rent and the utilities were shared with the home, so Marline’s employment expenses portion was = ($1,600 + $8,000) x 1.98% = $9,600 x 1.98 % = $190.08
Office maintenance was paid for the office only, but she deducts according to the hourly use = $200 x 23.81% = $47.62
So Marlines total employment expenses = $2,600 + $190.08 + $47.62 = $2,837.70 and she will report it on line 22900 of her income tax return
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