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: Whether an eligible dwelling, for purposes of the new home renovation tax credit, must be a principal residence as defined in the Income Tax Act.
Position: Presently, there is no proposed legislation regarding the new HRTC. However, the budget documents states that an eligible dwelling is a dwelling that is eligible at any time after January 27, 2009, and before February 1, 2010, to be an individual's principal residence or that of one or more of his or her family members.
Reasons: In general, a housing unit is considered to be eligible to be an individual's principal residence if it is owned and ordinarily inhabited by the individual, his or her spouse or common-law partner, or his or her children. Therefore, any dwelling that an individual owns and uses personally could qualify, including a home and a cottage.
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Dear XXXXXXXXXX :
Thank you for your letter received on February 11, 2009, asking for clarification on whether an eligible dwelling, for purposes of the new home renovation tax credit (HRTC), must be a principal residence as defined in the Income Tax Act.
Presently, there is no proposed legislation regarding the new HRTC, which was introduced in the federal budget tabled on January 27, 2009. However, the Honourable James M. Flaherty, Minister of Finance, announced in Annex 5 of the budget documents that an eligible dwelling is a dwelling that is eligible at any time after January 27, 2009, and before February 1, 2010, to be an individual's principal residence or that of one or more of his or her family members.
In general, a housing unit is considered to be eligible to be an individual's principal residence if it is owned and ordinarily inhabited by the individual, his or her spouse or common-law partner, or his or her children. Therefore, any dwelling that an individual owns and uses personally could qualify, including a home and a cottage.
More information about the credit is available on the Canada Revenue Agency Web site at www.cra.gc.ca/hrtc and on the Department of Finance Canada Web site at www.budget.gc.ca/2009/pamphlet-depliant/pamphlet-depliant3-eng.asp and at www.budget.gc.ca/2009/plan/bpa5a-eng.asp#personal.
I trust that the information provided is helpful.
Sincerely,
Jean-Pierre Blackburn, P.C., M.P.
Ananthy Mahendran
(905) 721-5204
2009-031036
February 19, 2009
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