2020 Personal Income Tax: Your Frequently Asked Questions
Last updated Feb 11, 2021
With all the government programs introduced in 2020, it can be difficult to understand the potential impact these programs can have on your personal tax returns. We have received many of your questions surrounding this exact topic and we’ve put together a set of frequently asked questions to help you understand all the updates in your 2020 personal tax return.
Frequently Asked Questions
- I worked from home in 2020 due to COVID, can I claim office a deduction for my home office?”
- Are my CERB benefits taxable?
- My employment income was reduced in 2020, can I still claim my child care deductions?
- Do I need to repay my CERB payments?
- I received the BC Recovery Benefit, is it taxable?
- Are there any other new deductions I can claim in 2020?
- I would like you to prepare my personal tax return. How do I send you my information?
Frequently Asked Questions
I worked from home in 2020 due to COVID, can I claim office a deduction for my home office?”
For individuals earning employment income (“employee”), claiming home office expenses has traditionally been a detailed process that requires the employer to first sign off on a T2200. Due to the COVID-19 pandemic, CRA has simplified the rules for the 2020 taxation year. Note that this change does not apply to self-employed individuals as previous rules for self-employed individuals still prevails.
Employees now have the option to claim the deduction through simplified method or traditional detailed method:
Traditional Detailed Method
- The employer must sign off on a T2200 form indicating the eligible employment expenses to be claimed
- The employee must summarize the total* eligible employment expenses to be claimed in their Personal Tax Return (T1). Common eligible employment expenses include:
- Home Office Expenses (rent or mortgage interest**, utilities, insurance, property taxes, maintenance, internet)
- Motor Vehicle Expenses (fuel, maintenance, insurance, parking)
- Office Supplies
* Provision requires totals only. It is recommended that you keep detailed records in the event that CRA requests for them.
** Mortgage interests cannot be claimed by Salaried employees and commission employees. If earning commission, please visit CRA’s website for more information.
- No T2200 required
- The employee worked more than 50% of the time from home during at least 4 consecutive weeks in 2020 due to COVID-19
- Flat rate of $2/day to a maximum of $400 (200 working days) per individual
Are my CERB benefits taxable?
CERB is fully taxable and will need to be included in your T1 Personal Income Tax Return. You will receive a T4A slip from CRA for the benefit amounts received. This will also be available in your ‘CRA My Account’.
My employment income was reduced in 2020, can I still claim my child care deductions?
If you received CERB in 2020, it is classified as “earned income”. This means that you can deduct child care expenses against it in addition to employment and self-employment income.
Do I need to repay my CERB payments?
CRA requires individuals to repay CERB payments if any of the following situations applied to the individual in 2020:
- earned more income than expected during the respective eligibility period, or
- received CERB from both Service Canada and the CRA for the same eligibility period, or
- received CERB but later realized eligibility requirements not met.
2020 Tax implications Repaid before December 31, 2020: this repayment will be reflected in your T4A slip. As such, tax will be paid on the net amount.
Repaid after December 31, 2020: the gross amount will be reflected in your T4A slip. As such, tax will be paid on the gross amount. The repaid amount will be reflected in your 2021 taxes.
If you are unsure and concerned you may need to repay, please contact the CRA at 1-833-966-2099. More information available on CRA’s website
Update: On February 9, 2021, the Government of Canada officially clarified their position on the gross vs. net income interpretation for self-employed individuals. While the original interpretation assumed a net basis, self-employed individuals who claimed using a gross basis will not be required to repay the CERB payments received. to
I received the BC Recovery Benefit, is it taxable?
The BC Recovery Benefit is not taxable. You do not need to send us any supporting information about the benefit.
Are there any other new deductions I can claim in 2020?
New for 2020 Personal tax returns is a non-refundable tax credit for Digital news subscription expenses up to $500. This will apply for a digital news subscription with qualified Canadian journalism organizations. This is for subscriptions where written news is the primary product. If you think you have a subscription that qualifies, please let us know the name of the subscription and the total amount paid in 2020.
I would like you to prepare my personal tax return. How do I send you my information?
We’ve compiled some handy checklists to assist you in gathering the right information for the preparation of your 2020 personal tax return. You can fill out and upload your personal tax information through our secure online form (our preferred method!)
Alternatively you can also download a PDF copy of the checklist using the links below:
To ensure that your 2020 return is filed on time for the April 30, 2021 deadline, please make sure to send us your information by Friday, April 16, 2021.
In these unprecedented times, we understand that there is a lot of information to disseminate.
We at Provision are here to help you in any way we can. Feel free to reach out directly to your contact at Provision for more details and clarifications.
604-273-6601 ext. 109
604-273-6601 ext. 112
604-273-6601 ext. 104
604-273-6601 ext. 105