How to Claim Home Office Expenses in Canada (2026 Guide)

Quick answer

Canada has two separate home office regimes: one for employees, run through Form T777 and the employer’s T2200, and one for the self-employed, run through Form T2125. They share the idea of a work space percentage but differ in who qualifies and which costs count. This guide covers both, with worked examples, the GST/HST side for registrants, and records. Rules are from the CRA in the Sources section, retrieved 10 October 2026.

Employees: who qualifies

To claim actual home office expenses as an employee you must meet all of these conditions ^[1] :

• your employer required you to work from home, which can be a written or verbal agreement; a formal telework arrangement you entered voluntarily counts as required;
• you had to pay the work space expenses yourself;
• either you worked more than 50% of the time from the home work space for at least four consecutive weeks, or you used the space only for work and regularly met clients or others there in person;
• you have a completed and signed Form T2200 from your employer.

Choosing to work from home doesn’t qualify, and you can’t claim anything your employer reimbursed ^[1] . The temporary flat rate method doesn’t apply from the 2023 tax year ^[2] .

Employees: what you can claim

Salaried employees can claim the work space share of electricity, heat and water, the utilities part of condo fees, monthly home internet access fees, maintenance and minor repairs, and rent ^[3] . Commission employees can also claim home insurance, property taxes, and leased equipment such as a phone or computer that reasonably relates to earning commission income ^[3] . Neither group can claim mortgage interest or principal, internet connection fees, furniture, or capital costs like renovations ^[3] .

Worked example: a salaried analyst required by her employer to work from home uses a 10 m² room in a 100 m² apartment, about 10% of the space, and works there 40 hours of the 168 in a week. If the room is also used privately outside work hours, she applies both the area share and the time share, the method CRA sets out for shared spaces ^[6] . Her rent and utilities total $24,000 a year: $24,000 × 10% × 40/168 ≈ $571. A room used only for work skips the time step.

The self-employed: business-use-of-home

You can deduct business-use-of-home expenses if the work space is your principal place of business, or you use it only to earn business income and regularly and continuously meet clients there ^[4] . Qualifying costs are a share of heating, home insurance, electricity and cleaning materials, property taxes, mortgage interest and capital cost allowance, or the work space share of rent ^[4] . The claim can’t exceed your net business income before it, and anything unused carries forward to the next year ^[4] .

GST/HST

Input tax credits are claimed to the extent purchases are used in commercial activities ^[5] . Residential rent and mortgage interest don’t carry GST/HST, so only costs like utilities and supplies generate credits. Employees don’t claim input tax credits.

Records

Keep the signed T2200, your calculation of the work space percentage, and the bills behind every amount claimed ^[1] . The record-keeping guide covers retention periods.

Common mistakes

• Using the flat rate for 2023 or later ^[2] .
• Claiming without a signed T2200 ^[1] .
• A salaried employee claiming property taxes or home insurance ^[3] .
• Claiming mortgage interest or internet connection fees as an employee ^[3] .
• A self-employed person using the home office to create a loss ^[4] .
• Claiming expenses the employer reimbursed ^[1] .

Software that helps

ExpenseFlow captures utility, internet and supplies invoices for a business by email, upload or photo, codes each line with a tax code and a written reason, and can apply a fixed business-use percentage you configure per account. It syncs to Xero or QuickBooks Online after approval. It doesn’t prepare a T777 or T2125.