It’s not just Facebook that’s prompting people to play 2013 in review. Tax advisors are suggesting it too, particularly if you’ve purchased a new home, renovated an existing one or made adjustments to accommodate an aging parent.
When you use tax software or hire an accountant, an upfront interview process alerts you to tax credits that may be applicable, but it’s always a good idea to educate yourself as well so that ultimately “no money is left on the table,” says Matt Kanas, head of communications for TurboTax at Intuit Canada,
“A lot of people, especially in Toronto, who are looking at purchasing that first home are likely to go above their ceiling,” says Kanas. “That is a reality for a lot of folks. But there are ways you can recoup some of that through taxes.”
The federal government’s First-Time Home Buyers’ Tax Credit (HBTC) provides up to $750 in tax relief on the purchase of a new home. You are considered a first-time buyer as long as neither you, your spouse, nor common-law partner owned and lived in another home in 2013, or in any of the four preceding calendar years. To qualify, you must occupy the home as your principal place of residence no later than one year after its acquisition.
Another tax deduction that may be available to you if you purchased a new home or renovated an existing one extensively is the GST/HST New Housing Rebate, which includes a provincial rebate schedule for Ontario residents to offset the 13 per cent HST. It applies to your primary place of residence and also applies if you purchased a new mobile, modular or floating home, share in a co-operative housing corporation, or rebuilt your home following fire.
“What that rebate effectively does is enable homebuyers to receive a rebate of up to about $24,000 (subject to change) based on GST/HST paid during periods of home construction or renovation,” explains Kanas.
That’s why it’s always a good idea to hang onto receipts during a home renovation, he advises. Many Torontonians were left with major home renovations following last year’s flooding and ice storm damage. There’s a good chance they can get some of that money back.
“This is definitely a credit Torontonians should be looking into,” says Kanas. “People who had to live through that can find a little bit of respite in at least getting a little bit of money back on their rebuild.”
When you look back on 2013, you should also consider any renovations you may have made to your home to accommodate an aging parent. Ontario’s Healthy Homes Renovation Tax Credit – sometimes referred to as “the sandwich generation tax credit,” says Kanas – was introduced to assist with renovations such as walk-in bathtubs, grab bars, wheelchair ramps, comfort height toilets, pull-out shelves, non-slip flooring and a myriad of other projects.
“These are things that cost tens of thousands of dollars to install and this is another way you can claim up to about $10,000 of eligible home improvements,” notes Kanas.
By Dianne Daniel
Do you plan to do any renovations in 2014? Take a look at eieihome’s directory of general contractors.