Home additions are one of the most significant home improvement projects you can take on and greatly impact your home. By adding a new section to your home, you can alter its layout and change how you utilize its space. However, it’s no secret that a large renovation project requires a fair amount of money.
But is there a way to build the home addition of your dreams while also getting back some of the money you spent? Let’s take a look at whether this is possible.
Determining Whether Your Home Addition Is Tax Deductible
Ultimately, the answer to receiving a tax deduction on your home addition is no. However, that doesn’t mean you’re out of luck when it comes to seeing a return on your construction investment.
In Canada, you may be eligible for a tax rebate instead.
The Government of Canada offers a GST/HST new housing rebate. This rebate is designed to help those who have recently bought a home from a builder or renovated their home.
It’s important to note that these renovations need to be substantial in order to qualify for this rebate. Therefore, when it comes to home additions, be prepared to renovate your existing structure as well.
The Government of Canada does not consider a home addition to be a substantial renovation, as it is the existing home that must be renovated under this rebate. However, you may qualify for the GST/HST new housing rebate if you or a Calgary renovation company renovate your existing house, along with the home addition. This would make the GST/HST you paid on your addition eligible for the rebate.
It’s also worth mentioning that this rebate is designed for homeowners, rather than house flippers. Therefore, the home you are renovating and creating an addition for must be your primary residence.
Home additions can be a great investment in your home, but if you’re looking to see a financial return afterwards, it’s recommended that you research what options are available to you. Good luck!
Solid Solutions Renovations commits to providing homeowners and developers in Calgary with all their renovation needs. From kitchen renovations to basement developments in Calgary, we’re your one-stop-shop for everything. Our team will work side-by-side with you to ensure that your vision comes to life. We’re open with our processes and communication, and will happily answer any questions or concerns you have. We proudly serve Calgary and surrounding areas, including Airdrie, Chestermere, Cochrane, Okotoks, and more. For home renovations in Calgary, contact Solid Solutions Renovations at 403-477-0987 today.