The Ontario government has proposed a new refundable tax credit called the Healthy Homes Renovation Tax Credit. The purpose of this credit is to assist with the cost of permanent home modifications that improve accessibility or help a senior be more functional or mobile at home. Refundable means it is not based on income. The previous home renovation tax credit could be used to reduce the amount of Federal Tax Payable, it did not create a refund.
The credit would be worth up to $1,500 each year. The calculation is based on 15% of the maximum $10,000 allowable expense.
It can be claimed by a senior (65 years of age or older by the end of the taxation year for which the credit is claimed) who owns or rents a home
a spouse, son, daughter, step-children, in-laws, nieces or nephews. This is just a partial list of those who would be eligible to claim the credit.
The types of expenses that would be eligible are;
- Walk-in bathtubs
- Widening passage doors
- Wheelchair ramps, stair/wheelchair lifts and elevators
- Grab bars and related reinforcements around the toilet, tub and shower
- Non-slip flooring in the bathroom
- Hands-free taps
The types of expenses, services and devices that would not be eligible are;
- Repairs to a roof
- Replacing insulation
- Installing heating or air conditioning systems
- Wheelchairs or walkers
- Equipment for home medical monitoring
- Home care services
- Housekeeping services
- Outdoor maintenance and gardening services
As of the date of this blog, the Ministry has informed me that it has passed third reading and is expected to be implemented. Once passed the credit become retroactive to October 1, 2011. Any eligible expenses incurred on or after October 1, 2011 would qualify for the credit. The expenses from October 1, 2011 through December 31, 2012 would be claimed on the 2012 Personal Income Tax Return. After that the credit would apply to the regular January 1 – December 31 year.
So now is the time to look for any receipts that may be eligible that you’ve incurred since October 1, 2011. For receipts you can’t locate or that you might have disposed of, contact your supplier and ask for a duplicate.
For more information regarding this proposed credit, please click here.
If you have any questions regarding expenses that you’re unsure of as to whether or not they are covered under this proposed credit, or the standard medical credit, please contact me. I would be happy to help explain the Ministry’s position compared to that of the CRA.
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Until next time,