News

Special COVID-19 personal tax measure

In 2020, many Canadians were forced to change the way they worked. This meant that employees worked from home as a precaution to limit the spread of Covid-19. They found themselves working at their dining room table, in their bedroom or on their living room couch. With this new reality for millions of Canadians, the Government of Canada introduced a simplified process for claiming home office expenses for employees working from home due to the COVID-19 pandemic.

 

The Government of Canada introduced the temporary flat rate method that will offer a simplified way for employees to claim home office expenses of up to $400 on their 2020 tax return. To qualify for this deduction, employees must have worked from home more than 50% of their time over a period of at least four consecutive weeks in 2020 due to COVID-19. A deduction of $2 can be claimed for each day they worked home in 2020 up to a maximum of $400. A day worked from home includes any day that an employee worked full-time or part-time hours from their home. This simplified method does not require employees to maintain receipts for their home office and greatly reduces the time required to input the information into their 2020 tax return. Furthermore, under this new method, employees will not have to get Form T2200 / Form T2200S completed and signed by their employer. If you qualify for this deduction, please visit the government calculator to help assist with determining your eligibility and the maximum amount you can claim.

 

The simplified method does not replace the detailed method of calculating home expenses. Therefore, if employees worked from home due to COVID-19 and would like to use the detailed method, the government has introduced a new simplified form that employers can complete that will allow their employees to claim home office expenses. The detailed method requires employees to have receipts for their home expenses and the completed and signed Form T2200S/ Form T2200 from their employer. This method would allow employees to claim expenses including rent, electricity, heat, water, internet as well maintenance costs that were incurred for the period you worked from home. Other employment related expenses would also be deductible such as postage, stationary, ink cartridges and cell phones used for business. A full list of eligible expenses can be found on the government calculator. These expenses are limited to the space of the home office and the period that they worked at home during the year.

 

These changes to the home office expenses will greatly assist employees who found themselves working from their home during the COVID-19 pandemic. For assistance calculating your home office expenses or determining which method you should use when preparing your tax return for 2020, please contact one of our specialists who will be able to assist you.

The Fall Economic Statement 2020

The Fall Economic Statement 2020 was announced on November 30, 2020 and promises new funding to help Canadians through the Covid-19 pandemic. The government is announcing several new measures that will see Canadians through the pandemic to ensure a robust economy. Here are a few highlights:

  • The Canada Emergency Wage Subsidy will be increased to a maximum rate of 75% beginning December 20, 2020 and extended until March 13, 2021. The Canada Emergency Rent Subsidy and Lockdown Support will remain at the current rates until March 13, 2021. Both programs will run until June 2021.
  • Families with young children will receive temporary support of up to $1,200 in 2021 for each child under the age of 6 who are entitled to the Canada Child Benefit
  • The Canada Summer Jobs funding will be increased by approximately $447.5 million in new investments in the program next year. The new funding will allow for an extra 40,000 of new job placements for students compared to last year.
  • There is also additional compensation for Supply-managed Farmers who have been negatively impacted by the Canada-United States-Mexico Agreement. In addition to the $250 million already paid to the Dairy Farm Investment Program and the $345 million delivered through direct payment to dairy farmers in 2019-20, the government is announcing that dairy farmers will receive $1.4 billion in payments over three years. Furthermore the government is also announcing $691 million for 10-year programs for supply-managed chicken, egg, broiler hatching egg and turkey farmers.

COVID-19 Agriculture Update

To all our farmer clients, 

We hope you are staying safe & healthy. 

As you may be aware, there have been many economic relief measures being put in place to help out Canadian businesses as a result of the COVID-19 pandemic. This includes measures to help support Canadian farmers in these challenging times. The government knows that the Agriculture industry is very essential and is working on establishing more financial programs. 

We have prepared a newsletter with a brief description on the different financial assistance programs that have been announced by the federal government.