Temporary flat method no longer applies with form T2200
The Canada Revenue Agency is updating its webpages and Form T2200 for the 2023 tax year.
The updated form, which will be made available at the end of January 2024, along with other T1-related forms, will be easier to complete for employees who are only claiming a deduction for home office expenses.
Eligible employees who are looking to claim home office expenses for 2023 must use the detailed method. To do so, they need to have a completed Form T2200, Declaration of Conditions of Employment, signed by their employer.
This form must be completed by employers in order for their employees to deduct employment expenses from their income.
Employers will also soon have to specify details around dental care spending for employees when filing taxes, according to the Canada Revenue Agency (CRA).
What about the temporary flat rate method?
In 2020, the government introduced the temporary flat rate method to make it easier for employees who were forced to work from home due to the COVID-19 pandemic to claim home office expenses.
Eligible employees who were only claiming a deduction for home office expenses could also use the detailed method if their employer completed and signed Form T2200S, Declaration of Conditions of Employment for Working at Home Due to COVID-19.
In 2021, since many Canadians were still required to work from home due to the pandemic, the temporary flat rate method was extended for the 2021 and 2022 tax years.
The temporary flat rate method does not apply to the 2023 tax year, according to the government.
Other changes around Form T2200
Employees who worked from home in 2023 could be eligible to deduct home office expenses if they were required to work from home and spent more than 50% of their time working remotely for at least four consecutive weeks during the year.
A notable change for 2023 is that employers are no longer required to provide a handwritten signature on Form T2200, according to EY — an electronic signature will suffice.
This change stems from an amendment to the Income Tax Act implemented by Bill C‑47, Budget Implementation Act, 2023, No. 1.
