The Canada Revenue Agency (CRA) has announced plans to introduce an updated Form T2200 for the 2023 tax year, aimed at streamlining the process for employees claiming deductions for home office expenses. This revised form is expected to be released by the end of January 2024, alongside other T1 related forms, to facilitate easier completion.
For the 2023 tax year, employees seeking to claim home office expenses are required to use the detailed method. This necessitates obtaining a completed Form T2200, the Declaration of Conditions of Employment, duly reviewed and signed by their employer.
The eligibility for claiming these deductions extends to employees who are mandated to work from home, under conditions that do not necessarily need to be stipulated in their employment contract. These conditions can be agreed upon either in writing or verbally.
To assist employees in calculating the amount they can claim, the CRA provides a calculator to estimate eligible expenses. Further information on this can be found on the CRA’s website under the section titled “Expenses you can claim.”
This update follows the introduction of the temporary flat rate method by the Government of Canada in 2020. This method was introduced to simplify the claim process for home office expenses for employees working from home due to the COVID-19 pandemic. During the pandemic, employees had the option to use either the detailed method or the temporary flat rate method, provided their employer completed and signed Form T2200S, specific to conditions of employment for working at home due to COVID-19.
The temporary flat rate method, initially introduced for the 2020 tax year, was extended through the 2021 and 2022 tax years, accommodating the ongoing necessity for many Canadians to work from home due to the pandemic. However, this method is not applicable for the 2023 tax year.