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COVID-19 Home Office Expenses Deduction

  • Last Updated:
  • May 7th, 2020 1:41 pm
[OP]
Deal Addict
Nov 10, 2018
3799 posts
3893 upvotes

COVID-19 Home Office Expenses Deduction

A very fascinating and useful read. I was not aware the CRA had even issued the whole home office $500 thing.

https://a.msn.com/r/2/BB13eSbv?m=en-ca& ... InAppShare
For legal topics and discussions, the opinion, guidance, and thoughts provided are my own and are not considered to be legal advice, in any manner.
14 replies
Deal Addict
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Dec 27, 2006
1518 posts
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Toronto
That is a waste of time for everyone, and a typical make work initiative for the CRA and the public service sector in general, and tax firms in particular. What is reasonable away when it comes to taxation and deduction? Why stop at $500? Why not $1,000? We can argue that anything that keeps us alive should be deductible, after all, if we are dead we cannot earn income to pay taxes.
Newbie
Aug 3, 2017
25 posts
6 upvotes
So I would be allowed to deduct:

-Min 500$ in office equipment
-%office for electricity, internet and rent

Working from home is not so bad afterall...
Deal Addict
May 4, 2014
4713 posts
5716 upvotes
Toronto, ON
Bosh123 wrote: So I would be allowed to deduct:

-Min 500$ in office equipment
-%office for electricity, internet and rent

Working from home is not so bad afterall...
Not internet.

And the $500 is not a deduction, it's the amount your employer reimburses you but without it having viewed as a taxable benefit(no tax consequence to you, but not a deduction).
Deal Fanatic
User avatar
May 11, 2009
5562 posts
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Debtario
So can I just buy a laptop for work and get $500 off my taxes for it? Maybe one day :(
"I possess a device, in my pocket, capable of accessing the entirety of information known to man. I use it to look at pictures of cats and get in arguments with strangers"
[OP]
Deal Addict
Nov 10, 2018
3799 posts
3893 upvotes
max88 wrote: That is a waste of time for everyone, and a typical make work initiative for the CRA and the public service sector in general, and tax firms in particular. What is reasonable away when it comes to taxation and deduction? Why stop at $500? Why not $1,000? We can argue that anything that keeps us alive should be deductible, after all, if we are dead we cannot earn income to pay taxes.
CERB and various other stuff can be viewed as a waste of money. The rest of us working = shouldering the payments to fund these initiatives. $500 is a very reasonable amount here for home offices.

Before the rest of you start deducting mortgage interest, rent payments, utilities, etc, you better know exactly how this works. Many of us have had a T2200 and know how to do this the right way. Don't start deducting everything under the sun if you don't know if you a) qualify and b) if you do, it's not as simple as many of you think.

Be careful. The CRA loves auditing home office expenses.

And yes, you can deduct a business portion of your home internet expenses. It falls in the 'other' field and is generally accepted by the CRA.
For legal topics and discussions, the opinion, guidance, and thoughts provided are my own and are not considered to be legal advice, in any manner.
Deal Addict
Jun 11, 2016
1620 posts
2361 upvotes
max88 wrote: That is a waste of time for everyone, and a typical make work initiative for the CRA and the public service sector in general, and tax firms in particular. What is reasonable away when it comes to taxation and deduction? Why stop at $500? Why not $1,000? We can argue that anything that keeps us alive should be deductible, after all, if we are dead we cannot earn income to pay taxes.
Guess am not making Max88 money because i'd just at the chance to be able to deduct an extra 500$ on my taxes.
Last edited by KravenHead on May 4th, 2020 4:03 pm, edited 1 time in total.
Deal Addict
Jun 11, 2016
1620 posts
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"To be entitled to deduct home-office expenses, an employee must be “required by the contract of employment” to maintain such an office.
The space must also be either where she “principally” (more than 50 per cent of the time) performs her duties of employment."

A- No home office clause in my contract as it was always assumed i could when i wanted/needed to
B- Businesses are now slowly reopening to very few will reach the "50%" stipulation.

Good read but nothing new...

Cheers, KH
Deal Addict
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Dec 27, 2006
1518 posts
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Toronto
I owed the OP an up vote for the reminder to get a T2200. Due to COVID-19 I am required to work from home, and eligible to squeeze this bit of tax savings from the evil CRA.

Sure we can agree on whatever $ mount that is reasonable. My point is that we can save a bit in taxes, government tax revenue short fall has to be made up from somewhere, and ultimately from other portion of our taxable income, making this whole $500 home expense scheme a moot point. We might as well scrap this paper work. (Don't get me wrong, I will do everything to squeeze every bit of tax savings).

ADDED
angryaudifanatic wrote: CERB and various other stuff can be viewed as a waste of money. The rest of us working = shouldering the payments to fund these initiatives. $500 is a very reasonable amount here for home offices.
...
It's nice that you and I are being recognized shouldering the payments. Just not forget that any kick back from the $500 deduction is added back to the burden, you and I are not better off. We are only worse off, because the added line in the tax forms translate into more overhead in the public service sector and more time you and I have to spend filling out the forms, only to add to the increasing burden you and I are shouldering.
Last edited by max88 on May 4th, 2020 7:57 pm, edited 1 time in total.
Deal Addict
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Dec 27, 2006
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KravenHead wrote: Guess am not making Max88 money because i'd just at the chance to be able to deduct an extra 500$ on my taxes.
Don't worry, you are still a decent person (if not more so) even if you deduct $500 and donate the tax savings then turn around and claim charitable donation tax credit.
Deal Addict
Jun 11, 2016
1620 posts
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max88 wrote: Don't worry, you are still a decent person (if not more so) even if you deduct $500 and donate the tax savings then turn around and claim charitable donation tax credit.
Lets agree to disagree. Working from home I did incur some unexpected expenses (monitor, new keyboard/mouse). I'd be nice to get some of it back.
Even though I'd like to see more than a 500$ limit...i won't say no to 500$
Deal Addict
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Dec 27, 2006
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KravenHead wrote: Lets agree to disagree. Working from home I did incur some unexpected expenses (monitor, new keyboard/mouse). I'd be nice to get some of it back.
Even though I'd like to see more than a 500$ limit...i won't say no to 500$
Let's not forget to deduct commute cost. Ooops, it's savings, shhhh, don't tell CRA.
[OP]
Deal Addict
Nov 10, 2018
3799 posts
3893 upvotes
max88 wrote: My point is that we can save a bit in taxes, government tax revenue short fall has to be made up from somewhere, and ultimately from other portion of our taxable income, making this whole $500 home expense scheme a moot point. We might as well scrap this paper work. (Don't get me wrong, I will do everything to squeeze every bit of tax savings).
To be fair, at this point, it's every man/woman to himself/herself. Everyone is acting like an entitled child right now with government bailouts going left right and center. I'll take whatever nickel they throw at me because apparently I don't pay enough taxes despite shouldering a six figure tax bill for decades. :rolleyes:
For legal topics and discussions, the opinion, guidance, and thoughts provided are my own and are not considered to be legal advice, in any manner.
Deal Addict
User avatar
Dec 27, 2006
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Toronto
angryaudifanatic wrote: To be fair, at this point, it's every man/woman to himself/herself. Everyone is acting like an entitled child right now with government bailouts going left right and center. I'll take whatever nickel they throw at me because apparently I don't pay enough taxes despite shouldering a six figure tax bill for decades. :rolleyes:
You and I are talking about the same things, in slightly different ways. I will deduct anything allowed, and take any tax credit entitled. Once I have all the money in my pocket, I can talk about helping others.

(Off topic: anyone ever wonders why most tax systems are so complex? It's survivorship biased. Any politician daring to say cutting handouts by $10 will be laughed out of town before having a chance to say a $11 tax break will follow. Any politician promoting highest $ handouts will be voted in power before admitting to raise $+1 in tax. This is the simplest to put it, less the consideration for the poor and less fortunate).
Deal Guru
May 29, 2006
10189 posts
2749 upvotes
the thing with taxes, is there is no penalty unless its fraud, you can play the ignorance card easy with this stuff.

claim the home expense, and if you get audited and lose, so be it, you pay back the cash you made on it.

put the savings in a checking account for 7 years if you are worried.

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