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It's Tax Season In Canada & You Can Get Up To $500 For Working From Home

Turns out it pays to spend your days in sweatpants. 💰

Contributing Writer
It's Tax Season In Canada & You Can Get Up To $500 For Working From Home

We come bearing good news for Canadians who work from home! Turns out spending your days in sweatpants has more benefits than just comfort — you also get money back from the federal government for doing so.

Tax season in Canada is here and the Canada Revenue Agency (CRA) is offering a great tax credit to people who worked from home during the 2021 tax year.

The simplest way to claim the work from home credit is a flat rate method, where you can claim a deduction of $2/day that you worked at home last year "due to the COVID-19 pandemic."

This flat rate has increased by $100 from the 2020 tax year. Eligible Canadian employees can now claim up to $500 for working from home in 2021, for a maximum of 250 working days.

The eligibility criteria for both the temporary flat rate method and detailed method has not changed though,

"Employees who were not required to work from home in 2021, but who worked from home because their employer gave them the choice to do so, are still considered to have worked from home due to COVID-19," the CRA confirmed in a news release.

Note that days off, sick days, vacation days and other absence days cannot be counted as working days.

You will not qualify for the tax rebate if your employer is already covering your work-from-home expenses.

In an interview with MTL Blog, the national tax specialist for UFile, Gerasimos Vittoratos, explained how this flat rate method works.

"If you're required to work from home due to the pandemic, as long as you have four consecutive weeks at home, you can deduct two dollars per workday, you're claiming as a deduction on your tax return, meaning that you're reducing your taxable income, you're reducing the income that you're being taxed on," Vittoratos said.

"It's 500 now. But remember, the maximum is based on the days you worked, it's not just, you know, oh, I could just take 500. You have to count your days. If you worked the whole year from home full-time, you would get the $500."

This article’s cover image was used for illustrative purposes only.

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