Subsection 122.92(1)
Eligible Individual
Administrative Policy
10 October 2024 APFF Financial Strategies and Instruments Roundtable Q. 9, 2024-1015481C6 F - Crédit d'impôt pour la rénovation d'habitations multigénérationnelles et exemption pour résidence principale
A taxpayer claimed the credit for renovations to the individual’s home that met all the criteria, including that of a separate unit for the taxpayer’s parents. Would the credit still be available if the individual sold the unit to them for its FMV a year later? CRA responded:
[T]he eligible individual, if a qualifying relation of a qualifying individual, must ordinarily reside, or intend to reside, in the eligible dwelling within 12 months after the end of the renovation period in respect of a qualifying renovation or be the owner of the eligible dwelling. In the example submitted, the taxpayer (a qualifying relation) was the owner of the eligible dwelling in the year in which the taxpayer claimed the Multigenerational Home Renovation Tax Credit. If all the other conditions of section 122.92 were satisfied, the sale of the unit to his parents would not disqualify the taxpayer from eligibility for the credit.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 122.92 - Subsection 122.92(1) - Qualifying Relation | qualifying relation does not extend to the spouse of a nephew or niece | 72 |
| Tax Topics - Income Tax Act - Section 252 - Subsection 252(2) - Paragraph 252(2)(g) | s. 252(2)(g) does not extend to the spouse or common-law partner of a niece or nephew | 32 |
| Tax Topics - Income Tax Act - Section 54 - Principal Residence | renovation to create a secondary unit for s. 122.92 credit purposes generally means that the whole building no longer can be designated as the taxpayer’s principal residence | 150 |
Qualifying Relation
Administrative Policy
10 October 2024 APFF Financial Strategies and Instruments Roundtable Q. 9, 2024-1015481C6 F - Crédit d'impôt pour la rénovation d'habitations multigénérationnelles et exemption pour résidence principale
CRA indicated that the expression “qualifying relation” in s. 122.92(1) refers only to the nephew or niece of the qualifying individual and (notwithstanding some wording to the contrary in the Budget Supplementary Information) not to their spouse or common-law partner (and also noted that the expanded meaning given to the terms “nephew” and “niece” in s. 252(2)(g) did not extend to the spouse or common-law partner of such niece or nephew).
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 252 - Subsection 252(2) - Paragraph 252(2)(g) | s. 252(2)(g) does not extend to the spouse or common-law partner of a niece or nephew | 32 |
| Tax Topics - Income Tax Act - Section 54 - Principal Residence | renovation to create a secondary unit for s. 122.92 credit purposes generally means that the whole building no longer can be designated as the taxpayer’s principal residence | 150 |
| Tax Topics - Income Tax Act - Section 122.92 - Subsection 122.92(1) - Eligible Individual | credit is not lost if secondary unit is then sold to its qualifying occupants | 159 |
Qualifying Renovation
Administrative Policy
13 March 2023 External T.I. 2023-0961401E5 - Multigenerational home renovation tax credit
An individual is constructing a family home with a semi-attached garden suite in which the individual’s parents will live. Is the multigenerational home renovation tax credit (MGHRTC) available if both dwellings are built concurrently (rather than the garden suite being required to be built and occupied second)? In responding affirmatively, CRA stated:
[S]ection 122.92 … does not require that an eligible dwelling be built prior to, or concurrently with, a secondary unit in order for qualifying expenditures to qualify for the MGHRTC. Section 122.92 also does not require that an eligible individual reside in the eligible dwelling prior to adding a secondary unit. However, there must be a reasonable expectation that both the qualifying individual and qualifying relation of that individual will ordinarily inhabit the housing unit (including the secondary unit) within 12 months after the end of the renovation period. In your case, this expectation would apply to you (as a qualifying relation) and your elderly parent (the qualifying individual).