Renovations that make homes safer or more accessible for seniors or the disabled may qualify for a new tax credit in 2016. If you are a senior or hold a valid disability tax certificate or are supporting a qualifying individual, up to $10,000 in expenses can be claimed.
Qualified individuals may claim this credit directly. Seniors aged 65 years or older, as well as taxpayers who hold a valid DTC, are considered qualified.
If you are supporting someone who qualifies directly, you may be entitled to claim this credit on his behalf. If you claim the amount for an eligible dependant, caregiver amount or amount for infirm dependants age 18 or older for the qualifying person, you may be eligible.
For example, imagine your elderly father resides with you and you spend $10,000 installing a wheelchair ramp to make your home more accessible. If you are eligible to claim the caregiver amount for your father, you may claim the ramp expense on your tax return.
What Expenses Qualify?
Generally, if the qualifying renovation allows better accessibility or improves safety, and is permanent it is eligible. Examples of qualified renovations include
- Grab bars and hand rails
- Walk-in tubs or wheel-in showers
- Widening doorways for wheelchair accessibility
- Lowering cabinets
Ineligible expenses include
- Household appliances or home-entertainment devices
- Routine maintenance
- Housekeeping costs
Claiming the Credit
To claim the HATC, complete a Schedule 12 (Home accessibility tax credit). Fill in the dates, types of expense, and names (and GST/HST numbers) of contractors or other tradespeople who performed the renovation. If you completed the work yourself, you may only claim the expense of supplies – not your own labour. If a family member performed the renovation, he/she must be registered for the goods and services tax/harmonized sales tax in order to claim the labour cost. Include this GST/HST number on the Schedule 12 along with the family member’s name.
As with most expenses, it not necessary to submit receipts with your tax return although it is important to retain your supporting documents in case CRA requests them.
Double (or even Triple) Credit
Many accessibility renovations also qualify as medical expenses. You may claim the same expense for both the HATC and as an eligible medical expense if the expense qualifies for both. Some provinces, such as Ontario and New Brunswick, offer an additional provincial credit. In effect, the same expense can be claimed three times on your tax return.
For example, a senior resident of Ontario who installs a walk-in tub to improve accessibility may claim three credits. If the expense totals $10,000, it breaks down as
- $10,000 X 15% = $1,500 federal credit for HATC
- $10,000 X 15% = $1,500 provincial credit for Healthy Homes Renovation Tax Credit
- $10,000 worth of medical expenses (both federal and provincial credits)