As tax season is upon us, we thought this would be the perfect time to discuss nine homeowner’s tax credits which, puts money back in your pocket and in some instances, are beneficial before you have even purchased a home.
- First Time Home Buyer’s Tax Credit
This tax benefit is beneficial to, you guessed it – First Time Home Buyers . If you or your spouse bought a home in the previous year, you could be eligible for the HBTC (First Time Home Buyer Tax Credit) of $5000 which adds $750 to your tax return. Check out this link to get more information before you prepare your tax return.
- New Housing Rebate on GST / HST
If you purchased a newly built home or a home that was substantially renovated and paid Goods and Services, you may be able to get a rebate on part of that tax with the new housing rebate. Check out this guideline for more info.
Home Buyer’s Plan
This benefit is a great way to help with the downpayment of your first Home. If you or your spouse/ common law spouse are residents of Canada and have a qualifying Registered Retirement Savings Plan Contributions, one or both of you may be eligible for a tax free withdrawal of up to $35,000 towards buying your first home. This can definitely help with a down payment on a home but keep in mind any amount you withdraw from your RRSP must be repaid within 15 years or they will become taxable. Learn more about the Home Buyers Plan Here.
- Home Accessibility Tax Credit –
Similar to the New Housing Rebate, this tax credit can give those eligible for a tax break on accessibility renovations costing up to $10,000. In order to qualify, you must meet one of three criteria
a. You’re over 65 years old
b. You’re a homeowner and you qualify for the disability tax
c. You’re eligible to make a claim for a qualifying individual (an eligible dependent)
Get all the deets here.
- Home Buyers Tax Credit for people with disabilities
Similar eligibility for the Accessibility Tax Credit, a person with disabilities who would qualify for the Disability Tax Credit or Spouse / Common Law Spouse of person who would qualify, or related family member who is purchasing the home to benefit said eligible person would quality for Home Buyers Tax Credit even if this is not the first home they have purchased. Click this link to learn more.
- Medical Expenses
Similar to the Home Accessibility Tax Credit, this credit can allow you to make a claim which could result in a tax credit of up to 25% of eligible medical expenses. In other words if home upgrades fall under the eligible medical expense list which you can search up here, for yourself or a qualified dependent then you could receive 25% of the expenses back in a tax credit. Please note that there is a predetermined set for each year, so look into the current amount or contact a tax consultant for more information.
- Homeowner Tax Credits for WFH (working from Home)
This one could be especially beneficial this year with many who transitioned working at the office to home during the Covid-19 Pandemic. If you were required to work from a home which requires home office expenses, you may be eligible to these tax credits. Additionally if you are self-employed, work on commission and home is where you also call the office, you could claim a portion of your utility bills, homeowners insurance, office supplies, internet, etc. Definitely invest in reading more about this one here.
- Moving Expenses Related to work or School
Alternatively if you have had to move more that 40 Km away to attend full time school, take a new job, or launch a new business, your moving expenses could be tax deductible. Check out this list to see possible moving expenses that fit the eligibility bill. Note, hotel bills, moving companies, etc could all be eligible.
- Rental Income Deductions
Last but not least! If you own real estate that you rent out, you could claim expenses related to advertising, property taxes, insurance, and interest on money borrowed to purchase or renovate the property.
Find out what’s eligible and what’s not here!
We hope these tips have been helpful, remember the tax deadline for 2021 is April 30, 2021.