Canadian Budget offers a tax break for Home Improvements in the year of 2009. So get your cheque book out, the tax man is helping with the bill!! If you have been thinking about refurbishing your kitchen or putting in an extra bathroom, etc and etc, this may be the year to achieve those home improvement projects that you have always wanted to tackle, because the tax man is helping out. Now how does this credit work? how to I apply? what items fall under this home improvement credit? So many questions regarding this program and so many of us can't seem to get answers. Well I found the information you need to get started and to educate yourself on this program. This is a program that you don't want to miss out on, lets be real its not very often that the Government actually gives back to us, so lets take advantage of it if we can!
The Home Renovation Tax Credit (HRTC) is a non-refundable tax credit for work performed or goods acquired in respect of an eligible dwelling.
What does that mean, eligible dwelling?
"An eligible dwelling is a housing unit that is eligible to be an individuals principal residence or that of one or more of their family members, at any time between January 27, 2009 and February 1, 2010. In general, a housing unit is considered eligible to be an individuals principal residence where it is owned by the individual and ordinarily inhabited by the individual, the individuals spouse or common-law partner, or their children. This means that any dwelling that you own and use personally could qualify, including your home or your cottage. "
What is the eligibility period?
"The credit will be based on eligible expenditures for work performed or goods acquired after January 27, 2009, and before February 1, 2010. Expenditures incurred pursuant to an agreement that was entered into before January 28, 2009, will not be eligible for the credit."
Who will be eligible for the credit?
"Eligibility for the HRTC will be family based. A family will generally be considered to consist of an individual or an individual and his or her spouse or common-law partner, including children who will be under 18 years of age, at the end of 2009. A family will be allowed a single credit that may be shared within the family.
If two or more families share the ownership of an eligible dwelling, each family will be eligible for their own separate credit (i.e. each up to $1,350) that will be calculated on their respective eligible expenditures. "
How will the credit be calculated?
"The credit will only be available for the 2009 tax year and applies to eligible expenditures of more than $1,000, but not more than $10,000, resulting in a maximum credit of $1,350 ($9,000 x 15%)."
What are eligible expenditures?
"To be eligible, expenditures incurred in relation to a renovation or alteration to an eligible dwelling (or the land that forms part of the eligible dwelling) must be of an enduring nature and integral to the dwelling, and includes the cost of labour and professional services, building materials, fixtures, rentals, and permits. Eligible expenditures must be supported by acceptable documentation."
Renovating a kitchen, bathroom or basement
New carpet or hardwood floors
Building an addition, garage, deck, garden/storage shed, fence
Re-shingling a roof
A new furnace, woodstove, boiler, fireplace, water softener or water heater
A new driveway or resurfacing a driveway
Painting of interior or exterior of a house
Window coverings directly attached to the window frame and whose removal would alter the nature of the dwelling
Laying new sod
Swimming Pools (Permanent - in ground and above ground)
Fixtures – lights, fans, etc.
Associated costs such as permits, professional services, equipment rentals and incidental expenses.
How will I claim the HRTC?
"A new line will be incorporated in the 2009 personal income tax return to allow you to claim the credit."
For more information on this Tax Credit please visit : http://www.cra-arc.gc.ca/gncy/bdgt/2009/fqhmrnvtn-eng.html#q1
Until next time,
w&c designer girl!