Are there any home renovation tax credit options for Canadians?

Are you thinking about making any renovations to your home? Or have you done so in the past couple of years? In Ontario, you may be eligible for a home renovation tax credit or housing rebate – especially if you are 65 or older.  This is part of the government’s effort to increase the number of healthy, environmentally friendly homes.  Regardless of your income, you and your family might qualify for a tax credit or rebate.

Here is an overview of some of your options:

Healthy Homes Renovation Tax Credit

This is a permanent personal income tax credit for seniors over the age of 65 and the relatives who live with them. Those who qualify can claim up to $10,000 worth of certain home improvements on tax returns. The amount of credit you could get back is calculated as 15% of the eligible expenses claimed.

What home improvements qualify?

Not all home renovation works qualify for this tax credit. Examples of work that DOES qualify include:

  • Wheel-in shower installation
  • Walk-in bathtub installation
  • Lowering of existing cupboards and counters
  • Renovations that allow for a first-floor occupancy for a senior
  • Widening of doors
  • Handrails
  • Grab bars in the bathroom, near the tub and toilet
  • Non-slip flooring
  • Wheelchair ramps and stair lifts or elevators
  • Easy to use door locks
  • Motion-activated lighting
  • Touch-and-release cupboards and doors

Some examples of work that doesn’t qualify for this specific tax credit include regular plumbing and/or electrical work, new window installations, and roof repairs. The devices themselves, such as wheelchairs, fire extinguishers, and monitoring equipment, do not qualify, nor do services such as housekeeping and homecare.

How do you get the credit?

Schedule ON (S12) must be completed on your tax return. The amount you spent on the eligible renovations should be entered on form ON (479) next to box 6311. Even if a relative or friend did the renovation work free of charge, you can still claim the amount you spent for the modification and materials.

Save all of the receipts related to the home improvement, including the ones that might not seem important.

Goods and Services Tax – Harmonized Sales Tax Rebate

The GST/HST offers housing rebates for individuals who have purchased a new home, substantially renovated their home, leased land for residential rentals, etc. For eligibility, the substantial renovation must include major changes. In general, 90% or more of the interior of the existing home has to be replaced or removed. Supporting walls, floors, roof, staircases, and the foundation do not have to be replaced or removed. The substantial renovation only includes livable areas. Finished basements and attics apply; crawl spaces and garages do not.

You may also qualify for this home renovation rebate when you convert a commercial property to a home or hire someone to build a major addition to your current home.  This addition should be at least twice the size of the existing livable area.

If you want to find out whether you qualify for home renovation tax credit, consult with a tax professional that specializes in your area.