An individual can deduct certain expenses they paid to earn employment income if they meet certain conditions including:
- their employment contract required them to pay the amount; and,
- they did not receive an allowance for the expenses or the allowance they received is reported as income.
Employees must obtain a signed T2200, Declaration of Conditions of Employment, from their employer to deduct employment expenses from their income.
Eligible employment expenses are quite limited. However, they may include, for example, motor vehicle expenses, supplies, and certain work space in the home if you meet particular criteria. Additional expenses may be available to commissioned salespersons.
Action Item: Obtain a signed Form T2200 from your employer before deducting employment expenses.