With the calendar reading the middle of March, you are probably already gathering receipts and invoices to take to your financial planner or accountant in an effort to get all your tax paperwork in order before the April 30th deadline. Before you hand over all your documents and donation slips, make sure that you are aware of all the possible tax rebates and deductions offered to Homeowners. If you think that there is even a chance you could take advantage of one of these benefits, point it out to your accountant.
Medical Renovations. Those who have made home renovations done to accommodate a mobility issue, can claim this as an expense that was required in order to make their home more accessible. The government provides an extensive list of eligible and non-eligible medical expenses. Keep in mind, however, that medical expense reimbursement has to fall within a 12-month period ending in the current tax year.
The Home Buyer’s Plan. Allows you to withdraw up to $25,000 from your registered retirement savings plan (RRSP) to help with the purchase or construction of a home. Certain conditions apply. Submit a request by completing the T1036 tax form that is available.You will have a 15-year period to pay it back without penalty.
Selling a home.Generally, the GST/HST does not apply when you sell your home, but there are cases where it does. For example, if you built the home, you may have to pay the GST/HST. If the home you sell is not your principal residence, you have to report the capital gains. Also, there are a number of moving tax deductions available to you.
New Home Rebate. If you bought a new home that cost less than $450,000 or you renovated your home extensively and it is your principal residence, you may be able to claim the GST or HST under the new housing rebate. Other home tax deductions exist for homes that are built by the owner as well as for residential rental properties.
Rental Income. If you rent a property you own or that you have use of, use the T776 tax form to report rental income and claim allowable expenses such as advertising, insurance and interest on money you borrow to buy or improve the property.
First-time Home Buyer’s. If you are buying a home for the first time, you can claim a non-refundable tax credit of up to $750. This new non-refundable tax credit is based on a percentage of $5,000. You or your spouse or common-law partner can claim the home buyer’s tax credit.
Working From Home. There are a number of expenses that you can deduct if you are either self-employed, a commissioned employee or a professional. Examples of the type of expenses that you can claim include heating, home insurance, electricity and cleaning materials.
Provincial credits. In Ontario, homeowners can also apply for the Ontario property tax credit and the Senior Homeowner’s Property tax credit.
For more information, please consult the CRA website. Make sure that when you are meeting with your accountant or tax preparation specialist, you inquire about any and all tax deductions available to you. It could be very surprising how much money you can recoup at tax time, just by being a homeowner.