With all non-essential employees working from home during lockdown the question is often asked whether the employee can benefit from a tax deduction on their home office.
This may not be a radical change for some employees. Many employers have allowed and encouraged working from home for a specified number of days per week as standard. These employers usually have agreements with the employees as to which expenses they are allowed to claim monthly from the company, e.g. internet or telephone expenses. In this case, your employer will likely increase the reimbursement amount for the period in which you work solely from home.
If the commission component of your salary is more than 50% then you may be eligible to claim some of your home office expenses due to the lockdown period. To qualify, you need to spend more than 50% of your official working hours working from a dedicated office space at home. If you were already spending some days working from home, you will need to keep record of this, as the lockdown period may then push you over the 50% threshold for the year. It is advisable for you to also start keeping track of your home office expenses if you expect to go over the 50% mark so that you are prepared when tax season comes next year.
This also applies if you are a normal salaried employee who spends more than 50% of working hours for the year working from a home office, but your employer is not reimbursing you for your expenses. Start keeping record of your hours and expenses, as above.
The amounts and types of expenses deductible vary based on the setup of your home office. We can complete your tax return to assure that you receive the maximum benefit available to you. Contact us for an appointment regarding your 2021 taxes and how you can start preparing for them today.
