2020 was a year-long roller coaster where the Covid19 pandemic forced most of us in the tech industry to work from home.
The good thing is that your commute is much shorter, bad news? Costs have begun to pile up. I had to upgrade the internet, make my computer screen bigger, and get an ergonomic chair.
The Government of Canada was great at helping out with emergency subsidies, but here’s another subsidy that many don’t know about.
$ 400 tax incentive
The Canada Revenue Agency (CRA) has introduced a $ 400 tax incentive this year for telecommuting. You can claim it on your 2020 income tax return. Note that this is not $ 400 free cash, but you can apply $ 400 to your total income to reduce taxes.
The good thing about this tax cut is that you don’t have to submit any paperwork for this deduction, you just claim to have worked from home to qualify.
To simplify both taxpayer and enterprise processes, CRA will allow telecommuting employees to work from home in 2020 with COVID-19 up to $ 400 based on telecommuting hours without tracking details. Make it billable. No cost, and generally does not require people to provide a signed form from their employer.
How to qualify
You must pass four points to receive this $ 400 tax credit.
- You are working more than 50% at home in 2020
- I had to work from home because of the Covid 19 pandemic
- You are only charging for your home office and nothing else
- The company you work for did not reimburse you
The employer does not need to provide you with a form. If your home office costs more than $ 400, you can choose to request the T2200 form from your employer. You can spend more on that method, but you will have to fill out some paperwork.
$ 400 WFH Tax Deduction from CRA-How to Qualify-PlanetWeb.ca
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