Home Office Deduction Calculator
Work out your CRA business-use-of-home deduction (T2125 line 9945) with the detailed method — the only method available to self-employed Canadians in 2026.
Home Office Deduction Calculator
CRA detailed method · T2125 line 9945
Annual home expenses
Interest only — not principal.
Used to apply the CRA loss limit. Leave blank to see the full amount.
Enter your workspace size and home expenses to see your deduction.
How the CRA home office deduction works
If you're self-employed and work from home, the CRA lets you deduct a portion of your home costs as a business expense on line 9945 of Form T2125. There is no flat rate for the self-employed — you use the detailed method, which prorates your actual expenses by how much of your home is used for business.
Do you qualify?
You qualify if either of these is true:
- Your home is your principal place of business (you do more than 50% of your work there), or
- You use the space only for business and on a regular and continuous basis to meet clients, customers, or patients.
The formula
Your business-use percentage is your workspace area divided by the total finished area of your home. If the room is shared with personal use, you also multiply by the share of time it's used for work (hours ÷ 168 hours a week). Apply that percentage to your eligible home expenses to get your deduction.
deduction = (workspace ÷ total area) × time-share × eligible home expenses
What you can claim
A prorated share of:
- Utilities — heat, electricity, and water
- Home insurance
- Maintenance and repairs
- Owners: mortgage interest (never the principal) and property taxes
- Renters: rent
The deduction can't create or increase a business loss — it can only bring your net income to zero. Anything left over carries forward to future years.
Frequently asked questions
Is there a flat-rate or simplified home office method for self-employed Canadians?
No. The $2-per-day temporary flat rate method was a pandemic measure for employees only, and it ended with the 2022 tax year. For 2023 through 2026, self-employed people must use the CRA detailed method: prorate your actual home expenses by the share of your home used for business.
How do I calculate my business-use-of-home percentage?
Divide your workspace area by the total finished area of your home. If the space is used only for business, that percentage is your business-use rate. If the space is shared (like a dining table), you also multiply by the share of time it is used for work — CRA expresses this as business hours divided by total hours.
Which home expenses can a self-employed person deduct?
Everyone can deduct a prorated share of utilities (heat, electricity, water), home insurance, and maintenance and repairs. Homeowners can also deduct mortgage interest (not the principal) and property taxes. Renters can deduct a share of their rent. These go on line 9945 of Form T2125.
Can my home office deduction create a tax loss?
No. Business-use-of-home expenses cannot create or increase a business loss. You can only deduct enough to bring your net business income to zero. Any unused amount carries forward indefinitely and can be claimed against business income in a future year.
Should I claim capital cost allowance (CCA) on my home office?
Usually not. While you can claim CCA on the business-use portion of a home you own, doing so can trigger capital gains and recapture and can jeopardize your principal residence exemption when you sell. Most self-employed Canadians leave CCA off the home and claim it only on equipment. Confirm with your accountant.
Can salaried employees use this calculator?
This calculator is built for self-employed sole proprietors filing Form T2125. Employees use Form T777 and a signed T2200 from their employer, and they cannot deduct mortgage interest, property taxes, or CCA — so the eligible expenses differ.
Estimates based on the CRA detailed method (Guide T4002, Chapter 3) for self-employed sole proprietors. Not tax advice — your situation may differ. Confirm with a CPA before filing.