Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.
Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the Department.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.
Principal Issues:
(1) Whether a garage is a qualifying home for the purposes of the Home Buyer's Plan (HBP);
and
(2) whether it would prevent the owner to participate in the HBP.
Position:
(1) No.
(2) No.
Reasons:
The ownership of the garage would not prevent an individual from participating in the HBP, since the garage would generally not be considered to
be a housing unit for these purposes.
XXXXXXXXXX 990714
P. -A. Sarrazin
May 17, 1999
Dear Madam:
Re: Qualifying for the Home Buyer's Plan (the "HBP")
This is in reply to your facsimile of March 17, 1999, wherein you ask whether ownership of a piece of land and a garage in which an individual has been living for a period of time would disqualify the owner thereof under the HBP, described in section 146.01 of the Income Tax Act.
It appears that the interpretation you seek relates to proposed transactions to be undertaken by a specific taxpayer and, therefore, we bring to your attention Information Circular 70-6R3 dated December 30, 1996, issued by Revenue Canada. Confirmation of tax consequences with respect to proposed transactions involving specific taxpayers will only be provided in response to a request for an advance income tax ruling. If you wish to obtain an advance income tax ruling with respect to a specific proposed transaction, a written request for an advance income tax ruling can be submitted in accordance with the Information Circular. Nevertheless, we can provide you with the following general comments.
You will find the Department's general views regarding the HBP in the Guide titled "Home Buyers' Plan (HBP) - For 1999 Participants" (RC4135). In order to participate in the HBP, an individual has to satisfy several conditions which are described very clearly in the Guide.
One of the conditions is that the person qualifies as a first-time home buyer. A person is not considered a first-time home buyer if, at any time during the period beginning January 1, 1995 and ending 31 days before any HBP withdrawal in 1999, the individual or the individual's spouse had an owner-occupied home. An individual will be considered to have an owner-occupied home where the individual owns (jointly or otherwise) a housing unit and the housing unit is inhabited by the individual as the individual's principal place of residence at that time. In our view, even though a garage may have been used as a living accommodation, the ownership of the garage would not prevent an individual from participating in the HBP, since the garage would generally not be considered to be a housing unit for these purposes.
You can get a copy of the Guide at your local Tax Services Office or on the Revenue Canada internet site (www.rc.gc.ca).
We trust these comments will be of assistance.
Yours truly,
Paul Lynch
for Director
Financial Industries Division
Income Tax Rulings and
Interpretations Directorate
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