I have a client that is an educator supervising nursing students in hospital & PCH during their studies. She has two separate contracts with her employer, each with a different group of students. She gets one T4 slip from the employer. During covid, one of her groups (at PCH) was forced to work entirely from home, while the second group (at hospital) continued to work in the hospital setting > 50% of the time, while doing post conferences and frequent staff meetings from home. Working through the covid issues resulted from LOTS of meeting time and other work from home.
I’ve instructed my client that she can only claim the $2.00 daily credit for the 1st group of students.
If consideration was given to using the Detailed method, my client is asking if the hours spent working at home with the 2nd group of students could be considered in the calculation. My guess is that we need to keep each contract separate even though they are with the same employer and only one T4 slip is issued. Thus, I would say NO since it doesn’t meet the > 50% rule and she’s not meeting her students or staff in her home.
Any thoughts?
I don’t know that I can answer your question… but just wanted to add a little perspective, since on the surface this $2.00 per day flat rate almost seems like a joke until you drill down into the mechanics behind the detailed method;
For commissioned employees (industry calls them “Producers”) lets say it costs you $12,600 per year to run your home;
1,800 electricity
1,800 heat
1,000 water
1,500 internet
1,500 insurance
5,000 property tax
12,600 total
Divided by 365 days that works out to be about 34.50 per day.
Lets say you use 15% of your home as your “home office” (perhaps 300 sq ft out of a 2,000 sq foot house) … that would work out to be about 5.18 per 24 hour period.
Lets further assume that you work from home 8 hours a day; That would calculate out to be be 5.18 x 8 hours worked divided by 24 hours in a day = 1.72 per day expenses under the Detailed Method if you were a commission based employee.
The Flat Rate Method allows you $2.00 per day
If you are not a producer then you are not permitted to claim home insurance, or property tax so the “office in home” claim under the “Detailed Method” would be reduced to about 85 cents a day for an employee working from home 8 hours a day and using 15% of their home.
Now… it’s strange… only commission employees can claim property taxes, yet if you rent your home anyone can claim the rent they pay. If you pay $2,000 per month to rent your home then this could add about another 3.30 per day (using the same assumptions of 8 hours a day worked and 15% of the home).
I suppose what I’m getting at here… for just “office in home” expenses the difference between the flat rate method and the detailed method may not be as much as one would originally think.
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Thanks, Wayne …
I did a return the other day for a school teacher working from home for 65 days. She walked away claiming $130 simplified method. I did a rough calculation using the detailed method and would have been allowed only a $45.00 claim using just her condo fees (non-commissioned employee) and perhaps slightly higher if we added Internet.
This current client is also non-commission. I’m still waiting for her to give me figures on the number of days / hours working from home, and perhaps Bus-Use-of-Home costs for comparison, but curious on thoughts about merging the two contracts since it is one employer and one T4.
@kozakworld
Re: Second Group
Even though she frequently participated in (online?) conferences and staff meetings, the fact that it doesn’t meet the >50% work-at-home rule for that period, justifies your conclusion, assuming your client is non-commission or not a placement/placement agency worker.
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This is a calculation that clearly favours (and always has) renters. I have a client who is a journalist - worked from home virtually all of last year from March to December. She rents, not inexpensively, and has a whopping OIH claim. (Few rooms, pricy space. And, yes, a dedicated office.)
Because it’s limited to “consumables” it essentially negates a reasonable claim by homeowners. Most, I suspect will take the $400 claim.
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