Tax Strategy Solutions for You and Your Business

Home Renovation Tax Credit - Schedule 12

The federal government has offered an non-refundable tax credit based on eligible expenses for improvements to your cottage and/or home. You claim this credit on your2009 tax return. You would provide Revenue Canada the Schedule 12 form (click and download here) along with all your expense receipts.

You are eligible if you spent $1001 and no more than $10,000 between January 27, 2009, and before February 1, 2010.

Did you know:
Eligibility: Family based.  That means if two or more own the property each family is eligible for the deduction.
               Must be integral to the dwelling and can include the cost of labour and permits.

An example: I purchased blinds for my renovation in my livingroom. 
  You may deduct the cost of the blinds if they are permanent, the window itself, the labour to install the window.

Make sure that you keep your receipts and add them to the Schedule 12.  If your renovation has compiled alot of reciepts and you are not sure what to do with those reciepts.  You may go to www.c2online.ca and purchase the Simplified Ledger - Home Renovation and input your receipts on this ledger and take to your tax accountant. 

If you have any questions or conerns please do not hesitate to contact us and we will refer you to a Personal Tax Advisor.

Are you a corporation selling your company's belongings at a profit of what you paid?

Yes, then make sure that your accountant is aware of the capital dividend account T2054 (click and download here) a
deduction offered by Canada Revenue Agency.

A common pitfall for practitioners when planning the sale of a business is the incorrect calculation of the corporation’s capital
dividend account (CDA). In particular, the rules regarding the timing of additions to the CDA account from the sale of eligible
capital property (such as goodwill) can result in errors in calculation. Timing errors such as these could lead a corporation to
declare a dividend in excess of the actual balance in its CDA account, and this excess might be subject to penalties under Part
III of Canada’s Income Tax Act (the Act), as described below.  

Contact us to learn more.