The Trudeau Liberals announced that you now have to report the sale of your home on your income tax return. Up until now when you sold your ‘primary residence’, you didn’t have to pay any taxes on the money you may have made as profit. NOTE: We’ve always had a tax exemption on your residence – we never had to report the sale, because there were no taxes to be paid. Capital gains on your home were exempted from tax. Then the Liberals announced the home registry (you have to tell that you sold your house and for how much). That was “To ensure Canadians didn’t have to pay tax”.
Two weeks ago in Question Period the Liberal Minister of Finance explained the “exemptions to the exemptions”. NOTE: That means, that if you work from home, you are now an exemption to the exemption, and BECOME the latest Tax Target. The percentage of square feet you work from home in, or run your business from, could become now taxable! According to the conservative MP Cheryl Gallant: “…. they just slipped this one into an announcement about mortgage rules.” Look up her full report here: http://cherylgallant.com/2017/02/24/trudeau-tax-target-home/
PLEASE NOTE: We are not tax advisors! It is vital that you do your reviews on this with your tax advisor. You never could claim your mortgage payment but you can claim mortgage interest as long as it does not create a business loss. Currently you can claim, (some) expenses and still get no capital gains tax. Look for accountant opinions here:
Attached another simplified version:
Here’s Canada Revenue Agency site for Work Space expenses:
For work space use of principal residence:
Now, I do not wish to be an alarmist … but what about your basement suites? Or work and live spaces? Fun times ahead!
Keep your fingers crossed for this week’s budget … Cap tax? Home tax? Whichever the budget – which our government WILDY overspent … we will have more taxes.