Q. My wife and I purchased our first home last year. We used our RRSPs First-time Home Buyers Plan for our down payment. In addition, the home is more than 60 years old and required extensive renovations. Can I use the maximum home renovation credit for 2009 and carry the unused amount to next year?
– Jake and Allison, Scarborough
A. Using your Registered Retirement Savings Plan (RRSP) under The First-time Home buyers Plan has enabled many to enter the home ownership market. The real estate market in many major Canadian cities has rebounded with a vengeance. Individuals can deduct the RRSP contributions and subsequently withdraw without tax consequences. However, repayments must be adhered to or there will be tax implications.
You may claim the home renovation tax credit maximum of $9,000 ($10,000 less $1,000) for 2009. Unfortunately, this was a one-time economic stimulus credit that applies only to 2009. Excess amounts may not be carried forward.
Individuals filing their 2009 tax returns should look for non-refundable tax credits that will reduce their income taxes, such as:
- Children tax credit for kids under 18 at end of the tax year – no receipts
- Caregiver amount for residing parents or grandparents over 65 years –no receipts
- Canada employment credit – every employed individual can claim – no receipts
- Public transit amount – keep TTC or Go passes – receipts required
- Home renovation credit – NEW – receipts required
- Home buyer’s amount – NEW – receipts required
Taxpayers should be gathering tax receipts for submission to CRA and keep a good filing system in the event of a visit by the tax man.
