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How to calculate working from home expenses?

There are three methods to calculate the same.

• Actual cost method, where actual expenses incurred will be allowed as deduction.
• Fixed rate method, where 52 cents per hour will be allowed as deduction.
• Shortcut method, where 80 cents per hour will be allowed as deduction. However, this method can be applied only for the period 1 March to 30 September 2020.

Further, one has to keep records of number of hours worked from home, such as, timesheet, register, or any document which reflects number of hours worked.

Taxpayers who wish to use shortcut method (80 cents per hour), must include the notation “COVID-hourly rate” next to their deduction for home office expenses in their 2019-20 tax return & 2020-21 tax return.

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