2024-02-10 05:07:30
The tax season for the year 2023 is fast approaching and you can already find out what financial aid is available to you. If your job is teleworking, you could benefit from a significant deduction for your tax return via My file for individuals from the Canada Revenue Agency (ARC).
This initiative, taken in 2020 by the government of canada to help teleworkers during the pandemic, is still in effect. The deductions claimed by taxpayers reduce their taxable income and at the same time, reduce their overall income tax. Your money is hard earned: it’s worth being strategic and claiming your dues!
Last year, the simplified calculation method allowed you to deduct up to $500 from your expenses related to your teleworking environment. However, in 2024, the procedure to follow is very detailed, but the amount you could benefit from is likely to be much moregenerous than that of previous years.
What changes this year is the method which will require more time and paperwork.to declare your work from home expenses. You will therefore have to be patient, but your efforts will not be in vain if you are eligible!
Who can be entitled to the tax deduction for teleworking?
To be eligible for this assistance, the main condition is one of the following: your employer has asked you verbally or in writing to work from home or you have voluntarily entered into a teleworking agreement with your boss.
Also, you must have incurred expenses related to your home office – except those that were reimbursed by the company you work for.
Additionally, one of these two scenarios must apply to your situation:
- Your workspace is the place where you worked mainly (more than 50% of the time) for a period of at least four consecutive weeks during the year (this period may have lasted more than a month);
- You use your workspace only to earn employment income and it is used regularly to meet clients.or other people in the course of your work.
Furthermore, it is necessary thatyour employer has completed and signed one of these two work declarations: form T2200S or form T2200.
How to claim the tax deduction for teleworking?
To make this request on your tax return, you must now use the CRA’s detailed method.
First of all, it is important to choose the form which is adapted to your situation. Here are the two choices:
- Form for those who are working from home due to the COVID-19 pandemic and who wish to claim a deduction for home office expenses only;
- Form for those who must work from home or are working from home due to the COVID-19 pandemic and wish to claim a deduction for other employment-related expenses.
Before filling out the appropriate form, you can use the calculator of the CRA to determine the amounts to be entered.
How much can I get as a reduction if I teleworked in 2023?
The amounts vary according to several criteria, including your employment income and your expenses. In addition, your real estate situation (owner or tenant), the size of your work space as well as all the costs you have incurred for teleworking influence the reduction to which you are entitled.
Narcity Québec did a calculation test using the federal government tool and it is possible to deduct more than $5,000 on expenses related to your work. And even more, as this example below demonstrates.
Result of a deduction that was calculated on the Canada Revenue Agency website.Canada Revenue Agency
For this scenario, the eligible person presents the following situation and declares the following amounts and information:
- She earns between $40,000 and $50,000 per year;
- She is a tenant with a rent of $1,500 per month ($18,000 per year);
- She pays $50 per month for her electricity and $50 for her residential internet ($1,200 in total per year);
- She pays $50 per month for her cell phone plan;
- She uses a 200 square foot room with a total area of 850 square feet set up for her work space.
Note that several other expenses related to your work space, including equipment, supplies and maintenance costs (example: minor repair of the air conditioner in the house, purchase of light bulbs, costs to repaint the work space or again, purchase of household products) may be eligible and added to your return to maximize the amount of your deduction.
The federal government recommends keeping the documents used for your application for six years. “Each year, the CRA carries out several audit activities to maintain the integrity of the Canadian tax system and the Canadian public’s confidence in it. The CRA could check [ta] deduction in order to validate [ton] eligibility,” we can read on the Agency’s website.
In case you didn’t know: If you have not completed your income tax return for your 2022, 2021 or even 2020 taxes, know that there is still time to take advantage of the deduction of up to $500.
You must then use the simplified method. It is possible to deduct $2 for each day you worked from home during this period in addition to all other days your office was from home due to the pandemic.
Please note that you have until April 30, 2024 to send your 2023 tax return to Revenu Québec. Until then, it is possible to claim five tax credits in advance from Revenu Québec to financially help all those entitled to them.
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