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CRA now requiring Two Factor Authentication

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The CRA is now requiring taxpayers to use Two Factor Authentication (2FA) in order to log into their computer systems.

The version of 2FA that the CRA uses is based on SMS or VoiceCall to a known phone number. That is, they will either text or call you with the access code. If you try to access the account too many times without successfully logging into the account, your account will be locked.

Clients are advised to ensure that their phone number is kept up to date at the CRA as I do not transmit phone numbers to the CRA when I file the tax return.

(Be advised that the 2FA that the CRA is using can be hacked by SIM swapping as well as when you lose your cell phone. Caution is advised.)

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My employer is saying that I don’t need the T2200S

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I have now heard from a few clients about their employer saying that I don’t need the T2200S to claim my home office expenses. Is that correct?

There are a couple of points that I would like to make about employers telling their employees that they don’t need the T2200S.

One, the employers do not have the right to instruct their employees on how they are to file the tax return. If they do, they are over-reaching their authority as an employer. No employer has the right to instruct their employees what they are to do outside of work, unless that behaviour reflects badly on the employer. Equally, by doing so, the employer is opening themselves up to being sued by their employees for providing bad advice if the method that the employer wants the employees to use isn’t to the advantage of the employee.

Would you be willing to commit fraud because your employer instructs you to do so?

Two, the CRA requires that you provide the T2200S later, if they then demand the T2200S from the employer to prove that you can claim the deduction. All that they have said that you don’t need the T2200S at the time of filing. They said nothing about requiring it later. They can ask for it up to six years after they issued the Notice of Assessment.

Finally, the CRA has privately indicated to tax preparers that we are required to ask for the T2200S before we file the tax return. Otherwise, they will charge us!

So I recommend that all employees ask their employer for the T2200S automatically if they were moved to working from home due to COVID-19 on or after March 15, 2020.

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In-Office Meetings

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In certain cases, we are offering in office meetings.

To ensure that we meet health regulations, the following protocols will need to be followed:

  • Ontario Resident Visitors must have in hand copies of their Ontario QR Vaccination Barcode along with government ID.
  • Quebec Resident Visitors will be screened using the Quebec VaxiCode Verif App with government ID. This will require your Quebec VaxiCode Vaccination record.
  • If you have not received your second vaccination, please contact our office for alternative service arrangements.
  • Individuals who are unable to take the vaccine are highly recommended to use alternative service arrangements.
  • You will be also asked questions from the Ontario Public Health Screening Questionnaire.

After admittance, appropriate face masks will be required to be worn properly with both the mouth and chin covered.

Should you feel that this is too onerous, please contact us for the alternative arrangements other than in office meetings.

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Working from Home due to COVID-19

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This is consolidation of prior posts.

If you worked from home due to COVID-19 during 2020, your employer is expected to issue to you a completed form T2200S. You must complete the final section of the form yourself and provide it to me in order to make the claim.

For clients who wish to make the claim for working for home expenses due to COVID-19, there is a worksheet available in the common folder on the portal, where it will remain for this tax season. The worksheet is one page in length and provides information on how to gather the required information, how long to store that information, and how to report that information to me.

The worksheet is in the folder called, “!Information – Instruction” which should be on the top of the list of folders. All clients with access to the portal received an email with a link to the worksheet.

If you are a client and do not have access to the portal, you can request a portal account. If you would prefer to have the worksheet emailed to you, please reply to an email that you received for your 2019 or your 2020 tax return.

General emails requesting the worksheet and emails from people who are not current clients will be ignored.

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Phoenix T4 Slip Error

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I just noticed this error on a government T4 slip. This is for T4 slips for employees posted overseas. The primary worker who may be affected are members of the Diplomatic Corp. Individuals working in private industry such as the Oil Sector may also be affected.

Background

The definition for province codes for T4 slips may be found by checking this following web page. If you check the instructions for Box 10 – Province of Employment, the government has standardized all the codes.

These codes reflect the same two character provincial abbreviations used by Canada. The only two exceptions are:

  • US – for employment in the US, and
  • ZZ – for other, meaning that the employee worked in a country other than Canada or the United States, or if the employee worked in Canada beyond the limits of a province or territory (for example, on an offshore oil rig).

Problem

Phoenix has used the code EX instead of the authorized codes.

All government workers who work outside of Canada (principally the diplomatic corp,) will probably have their T4 slips registered at the Canada Revenue Agency with this wrong code in box 10. As a result, any person who downloads these tax slips will likely have a problem with importing the tax slip into their tax return, if you use tax software.