If you’re planning on making your home safer for yourself or a dependant this year, taking a few minutes to research your renovation could yield some pleasant results. Depending on the work done, you could be eligible for a number of provincial and/or federal tax credits.
New for 2016, the HATC provides a non-refundable credit of up to $10,000 on your federal tax return. To qualify, the renovations must be made to improve access to the home or reduce the risk of harm inside the home for disabled or elderly individuals. If you have a valid Disability Tax Certificate, are aged 65 or older, or claim certain tax credits for a disabled dependant, your reno may qualify. Qualifying renovations include installation of walk-in tubs, wheelchair ramps, and grab bars.
Similar to the HATC, certain renovations made to improve mobility or access qualify as medical expenses on your tax return. The good news is that you can “double-dip” these expenses. For example, if you’re a disabled homeowner and pay a contractor to install a walk-in tub, you can claim that expense for the HATC and as a medical expense.
The Provincial Triple Dip
Depending on your province of residence, your renovation may be worth triple at tax time. In addition to the HATC and METC, three provinces offer tax breaks on qualifying renovations. All three credits are refundable at the provincial level meaning that if you have no tax owing, you’ll receive some cash back.
If you’re an Ontario resident considering a disability-related renovation, this is your year! Not only would that walk-in tub addition qualify for the HATC and an eligible medical expense, it would also qualify for a provincial credit at tax time. Similar to the HATC, the Healthy Homes Tax Credit caps out at $10,000. It’s important to note that this credit is scheduled to end January 1, 2017 and applies to only seniors or family members who live with seniors.
Qualifying renovations for BC residents may also yield three times the credit. Similar to the HHTC, renovations made to improve access or mobility for seniors are eligible for a provincial credit in addition to the HATC and METC. Recent changes to this credit have expanded to include disabled residents under 65.
If you’re a New Brunswick resident aged 65 or older, qualifying renovations also bring a provincial credit. Rules are similar to the HHTC. This credit also caps at $10,000 meaning up to $1,000 as a bottom line refundable credit.
Non–tax-related rebates and assistance programs are available in other provinces. Qualifications and benefits vary from province to province so it’s important to research before you begin. In some cases, such as the Disabled Residential Rehabilitation Assistance Program for Homeowners in Nova Scotia, registration and approval from the provincial department is required before the renovation begins. Check your province’s rules before you start.