Find us on Google+ Google+

Wednesday, June 21st, 2017

Mortgage Rebates


Home Renovation

Do Home Renovations and Enjoy Tax ReliefWhen you think of home renovations, visions of sparkling new bathrooms or enhanced curb appeal often spring to mind. But, along with improving your home, did you know that installing a new shower or resurfacing your driveway could also save you money?

Thanks to the recently introduced Home Renovation Tax Credit, homeowners can turn their brand new deck into tax relief. That's because the HRTC provides a 15% income tax credit on eligible renovation expenditures — a perk that can put a maximum of $1,350 back in your pocket.

However, it's important to keep in mind that the HRTC is a temporary measure, which means that timing is key to taking advantage of the tax relief.

Now is the TimeThe timing couldn't be better. The HRTC applies to renovations performed after January 27, 2009, and before February 1, 2010.

What's more, the one-time credit may be claimed for the 2009 taxation year on spending exceeding $1,000 but not more than $10,000 on eligible home renovation projects.

In other words, if you have $4,000 in eligible spending, you'll qualify for a tax credit of $450 ($4,000 - $1,000 x 15% = $450).

Eligibility for the tax credit is family-based and family members can share the credit. However, if both you and your spouse are working, only one of you may claim the credit in your 2009 tax return. <br>
In addition, the HRTC can be applied to more than one renovation project .

Changes that QualifyRenovations on a home, cottage or condominium all qualify for tax relief, along with associated expenses such as building permits, professional services, equipment rentals and incidental expenses. Not every home renovation, however, is covered by the HRTC. Here are some examples of what does — and doesn't — count as eligible spending:

Eligible expenditures

- Renovating a kitchen, bathroom or basement

- New carpet or hardwood floor

- Building an addition, deck, fence or retaining wall

- A new furnace or water heater

- Painting the interior or exterior of a house

- Resurfacing a driveway

- Laying new sod

- Re-shingling a roof

- Window coverings directly attached to the window frame and whose removal would alter the nature of the dwelling

- Permanent swimming pools (in-ground and above-ground)

- Fixtures (lights, fans, etc.)

Ineligible costs

- Furniture or appliances

- Purchase of tools

- Carpet cleaning

- Routine repairs and maintenance (for example, furnace cleaning, snow removal, lawn care, pool cleaning)

- House cleaning.

Documenting ExpensesWhen claiming the credit, you won't need to submit your contracts and hardware store receipts with your 2009 income tax return. You must ensure, however, that this information — including agreements, invoices and receipts for all eligible expenditures — is available should the Canada Revenue Agency ask to see it.

In addition, documentation must clearly identify the type and quantity of goods purchased or services provided. So make sure you keep your paperwork in a carefully stored file for easy access. Here's the type of information you'll need to keep on file:

- Vendorcontractor's name, business address and GSTHST registration number

- Description of the goods provided and the date of purchase

- Date when the goods were delivered or when the work was performed

- A description of the work performed

- The amount of the invoice

- Proof of payment such as a credit card slip or cancelled cheque.

The Payback on Energy EfficiencyTax relief isn't the only upside to replacing your aging furnace with an energy efficient upgrade. Thanks to the ecoENERGY Retrofit program, homeowners may be eligible for federal grants of up to $5,000 when they make energy efficiency improvements to their home or property. The program aims to offset the costs of implementing energy-saving retrofits and projects by providing financial support to Canadian homeowners.

The grant applies to a host of measures that reduce energy consumption and provide for a cleaner environment. Not only do these measures help reduce energy-related greenhouse gases and air pollution, but they can result in substantial savings for Canadians, especially when combined with the HRTC..

Spend WiselyThe federal government estimates that about 4.6 million families in Canada will take advantage of the HRTC. The time-limited tax relief it offers makes now the ideal time to undertake any home renovations you've been planning.

And, thanks to the ecoENERGY Retrofit program, if energy-efficiency upgrades are also in the works, the timing couldn't be better — and the savings more substantial — to replace your furnace and resurface your driveway.

SEO Powered By SEOPressor