T2200 Tax Form – Should You Certify?

Recently we’ve had a number of inquiries regarding whether or not the University will sign off on T2200s to deduct rent costs from personal employment income when faculty use their home as an office space. The T2200, also known as the “Declaration of Conditions of Employment”, allows the employee to make claims that certain expenses were necessarily incurred to fulfill their employment duties and deduct those expenses from their income; however, the employer must certify the claims for deductions as being related to actual conditions of employment, and finally the Canada Revenue Agency makes a determination on whether or not to approve the claim. Section 8 of the Income Tax Act details permissible deductions from personal income, and Subsection 8(13) outlines where such deductions can be made for the use of a home office. This will only apply when an employee is genuinely required, as a condition of their employment, to incur personal office expenses (so, for example, faculty on sabbatical will not be eligible). Where the maintenance of an office is required to fulfill employment duties, the Act stipulates that home office expenses will only be deductible where that office is the place where the individual principally (i.e. more than 50% of the time) performs their employment duties.

Our general practice is to avoid issuing T2200s by directly reimbursing the employee for any expenses necessarily incurred as a condition of fulfilling their employment duties. Of course, there may be cases in which this is not done and in those exceptional cases, our practice should be guided by the law as set out above.