About 4.6 million families in Canada are expected to benefit from the Home Renovation Tax Credit Program announced as part of the 2009 Federal Budget yesterday.
Before you run to Rona - remember the budget has to be approved before this program will become reality - though if you are anything like me.. you have wish list that won't quit and it will be hard to contain yourself!
Once approved, taxpayers can claim the HRTC when filing their 2009 tax return.
Eligibility for the HRTC will be family-based. For the purpose of the credit, a family is generally considered to consist of an individual, and where applicable, the individual's spouse or common-law partner.
Family members will be able to share the credit.
Examples of HRTC Eligible and Ineligible Expenditures
Eligible
· Renovating a kitchen, bathroom, or basement
· New carpet or hardwood floors
· 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
Ineligible
· Furniture and appliances (refrigerator, stove, couch)
· Purchase of tools
· Carpet cleaning
· Maintenance contracts (furnace cleaning, snow removal, lawn care, pool cleaning, etc.)
Examples of the Benefits of the Home Renovation Tax Credit
The following examples illustrate how homeowners can benefit from the HRTC
· Sally and Ed are a couple who have recently purchased a house. In response to the temporary HRTC, they decide to replace their old windows and improve the insulation in their home in 2009, instead of waiting, incurring $10,000 in expenditures. After taking into account the $1,000 minimum threshold, a 15-per-cent credit will be available on $9,000 in eligible expenditures, providing tax relief of $1,350.
· William and Marie are a couple who are planning to purchase a more energy-efficient furnace for their home, and build a deck at their cottage sometime later. To take full advantage of the temporary HRTC, they decide to do both projects in 2009 rather than waiting. They pay $5,000 for the furnace and $3,500 for the deck. They also decide to have the area around the deck landscaped for $2,500, bringing their total costs to $11,000 ($5,000 + $3,500 + $2,500). Marie claims a credit of $1,350 on the maximum allowable amount of $9,000.
· Karen and Heather are sisters who share ownership of a condominium unit. They each incur $7,500 in expenditures renovating the kitchen in the condo. Karen and Heather each claim a $975 credit on eligible expenditures of $6,500 ($7,500 - $1,000).
You can download a 2 page PDF file about this program by clicking on the link>
