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.
Principal Issues: Do the costs for shutting down a septic system, for hooking it up to a new sewer, and for the new sewer itself would qualify for the HRTC?
Position: Providing all other conditions are met, the cost incurred for shutting down a septic system that is on the land which is part of an eligible dwelling is eligible for the HRTC. As for the cost incurred to hookup to a new sewer, only the cost incurred for the part of the hookup that is on the land which is part of an eligible dwelling is eligible for the HRTC. The cost incurred relating to the portion of the hookup that is not on the land which is part of an eligible dwelling is not eligible for the HRTC. Furthermore, the cost incurred for the sewer itself and for its installation is not eligible for the HRTC unless it is installed on the land which is part of an eligible dwelling.
Reasons: Draft legislation
XXXXXXXXXX
Dear XXXXXXXXXX :
XXXXXXXXXX , forwarded to me a copy of your correspondence regarding the new home renovation tax credit (HRTC). Please accept my apology for this delayed reply.
You wanted to know if the cost incurred for shutting down a septic system, for hooking it up to a new sewer, and for the new sewer itself would qualify for the HRTC.
The proposed HRTC will provide individuals with a temporary 15% non-refundable income tax credit on eligible home renovation expenditures for work performed, or goods acquired, after January 27, 2009, and before February 1, 2010, for agreements entered into after January 27, 2009. Taxpayers can claim this credit for the 2009 tax year on eligible expenditures exceeding $1,000, but not more than $10,000, which will result in a non-refundable tax credit of up to $1,350.
The legislation regarding the new HRTC was introduced in the House of Commons on September 30, 2009, by the Honourable James M. Flaherty, Minister of Finance. The proposed legislation states that expenditures will qualify if they are directly attributable to a renovation or an alteration of an eligible dwelling, including land that forms part of the eligible dwelling, and if the renovation or alteration is of an enduring nature and is integral to the eligible dwelling. Such expenditures will include the cost of labour and professional services, building materials, fixtures, equipment rentals, and permits.
An eligible dwelling is a housing unit located in Canada that is owned by the individual at the time of the renovation, and ordinarily inhabited by the individual, his or her current or former spouse or current or former common-law partner, or his or her children at any time after January 27, 2009, and before February 1, 2010. Therefore, any housing unit that an individual owns and uses personally, including a home and a cottage, qualifies for the HRTC.
You can find more information on the HRTC on the Canada Revenue Agency Web site at www.cra.gc.ca/hrtc and in the Government of Canada brochure available at www.actionplan.gc.ca/grfx/docs/hrtc_eng.pdf.
I trust that the information I have provided is of assistance.
Sincerely,
Jean-Pierre Blackburn, P.C., M.P.
Minister of National Revenue
Isabelle Landry
(613) 957-8971
2009-033312
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