Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.
Principal Issues: Whether home renovations completed in 2008 are eligible for the HRTC.
Position: No.
Reasons: Home renovations completed or contracted for before January 28, 2009, do not qualify for the HRTC.
XXXXXXXXXX
Dear XXXXXXXXXX :
The office of the Honourable Tony Clement, Minister of Industry, forwarded to me a copy of your correspondence, which I received on August 7, 2009, concerning the new home renovation tax credit (HRTC). In particular, you are asking if your home renovations completed in 2008 are eligible for the HRTC.
The proposed HRTC will provide individuals with a temporary 15% non-refundable income tax credit on eligible home renovation expenditures for work performed, or goods acquired, after January 27, 2009, and before February 1, 2010, for agreements entered into after January 27, 2009. Taxpayers can claim this credit for the 2009 tax year on eligible expenditures exceeding $1,000, but not more than $10,000, which will result in a non-refundable tax credit of up to $1,350.
The legislation regarding the new HRTC, which was introduced in the federal budget tabled on January 27, 2009, has not yet been made law. However, the draft legislation publicly released on September 14, 2009, states that expenditures will qualify if they are directly attributable to a renovation or an alteration of an eligible dwelling, including land that forms part of the eligible dwelling, and if the renovation or alteration is of an enduring nature and is integral to the eligible dwelling. Such expenditures will include the cost of labour and professional services, building materials, fixtures, equipment rentals, and permits.
An eligible dwelling is a housing unit located in Canada that is owned by the individual, at the time of the renovation, and ordinarily inhabited by the individual, his or her current or former spouse or current or former common-law partner, or his or her children at any time after January 27, 2009, and before February 1, 2010. Therefore, any housing unit that an individual owns and uses personally, including a home and a cottage, qualifies for the HRTC.
Home renovations completed or contracted for before January 28, 2009, do not qualify for the HRTC. The budget documents did not propose to allow expenditures incurred before that date to qualify for the HRTC.
You can find more information on the HRTC on the Canada Revenue Agency (CRA) Web site at www.cra.gc.ca/hrtc and in the enclosed Government of Canada brochure, which is also available at www.actionplan.gc.ca/grfx/docs/HRTC_eng.pdf.
The CRA will be responsible for administering the HRTC, whereas the Department of Finance Canada is responsible for tax policy. Any changes to tax policy would have to be proposed by the Minister of Finance and approved by Parliament. I am therefore forwarding a copy of our correspondence to Mr. Flaherty, for his consideration.
I trust that the information I have provided is helpful.
Sincerely,
Jean-Pierre Blackburn, P.C., M.P.
Enclosure
c.c.: The Honourable James M. Flaherty, P.C., M.P.
Minister of Finance
House of Commons
Ottawa ON K1A 0A6
Ananthy Mahendran
(905) 721-5204
2009-033681
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