What is a T2200?
Regardless of your employees’ situations, these forms exist to make independent work a little easier on them in situations where they have to pay their own employment expenses (e.g., gas, mileage, supplies, etc.). If you have yet to provide your employees with such a form, read on to learn the importance of filling one out and having it ready for them come tax time. A good example of someone who needs to fill out a T2200 is a travelling salesperson. Without their personal vehicle, they’d be unable to do their job. It’s unlikely they would purchase a vehicle solely for the purposes of the job, as it is likely an existing condition of getting the job in the first place. What they will have to pay for, however, is their own gas, insurance, mileage, and other related expenses. If they do not receive any reimbursement for vehicle expenses from their employer, the employer will fill out a T2200 form on their employee’s behalf, and the employee will then obtain the appropriate tax deductions from the federal government. It is crucial that employers send this form to their employees, otherwise they won’t be able to claim the relevant deductions come tax time, nor will they be able to prove their payment of these expenses if the CRA were to audit them.
Form T2200S
New for 2020 is the form T2200S, which applies to a wider group of employees in Canada. Initially, it only applies to the 2020 tax year but, with the ongoing changes presented by the pandemic, it might also come into use in 2021. According to the Canada Revenue Agency:
“If [an employee] worked more than 50% of the time from home for a period of at least four consecutive weeks in 2020 due to the COVID-19 pandemic, [they can] claim $2 for each day [they] worked from home during that period.”
Beyond this, employees can claim any additional days they worked at home, up to a maximum of $400.
Québec-based employees
If employees live in Québec, the equivalent form to the T2200 is called TP-64.3-V (General Employment Conditions). It’s also important to note that Revenu Québec maintains its own unique list of eligible employment expenses for workers in that province.
