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Employers - What you need to know about home office expenses for the 2023 tax-filing season

The Canada Revenue Agency recently updated its webpages and Form T2200 for the 2023 tax year. The updated form makes it easier to complete for employees who are only claiming a deduction for home office expenses. The CRA also created a calculator to help employees claim the home office expense deduction that they are entitled to.

Eligible employees who are looking to claim a deduction for 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, completed and signed by their employer.

What are my responsibilities as an employer?

As an employer, you can complete Form T2200 if your eligible employees request it. The CRA may review your employee’s claim to validate their eligibility and would refer to Form T2200 as part of this process.

Are my employees eligible?

Employees who are required to work from home and meet other conditions are eligible to claim a deduction for home office expenses. This requirement does not have to be part of their employment contract and may be a written or verbal agreement.

For 2023, if an employee has voluntarily entered into a formal telework arrangement with their employer, the employee is considered to have been required to work from home.

Does the temporary flat rate method apply to the 2023 tax year?

The temporary flat rate method does not apply to the 2023 tax year.

In 2020, the Government of Canada introduced the temporary flat rate method, which was extended for the 2021 and 2022 tax years,to make it easier for employees who were forced to work from home due to the COVID-19 pandemic to claim a deduction for 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.