Renew, restore and renovate

A20 - THE MUSKOKA SUN: Spring 2009
START PLANNING FOR YOUR COTTAGE UPGRADE NOW!
The 3 R’s of spring:
Renew, restore and renovate
Home Renovation Tax Credit
also applies to cottages
By Kim Good
W
hile the economy
flounders worldwide, governments are trying their best to restore
consumer confidence and
keep the dollars flowing.
Part of the Canadian government’s plan to encourage spending and help
keep the recession at bay
is to introduce a temporary Home Renovation
Tax Credit for 2009. But
don’t let the word “home”
throw you off, cottage renovations are also eligible
for the 15-per-cent credit
claimable on your 2009
income tax return.
Meant to stimulate economic activity by creating a demand for labour
and construction materials while encouraging
homeowners to invest in
their greatest assets, the
Any improvements to
an eligible dwelling
qualify
tax credit can be claimed
on the portion of eligible
expenditures exceeding
$1,000, but not more than
$10,000. This means that
the maximum tax credit
that can be received is
$1,350, or 15 per cent of
the $9,000 difference.
Examples of eligible
expenses include renovations to a kitchen, bathroom, or basement; new
carpet or hardwood floors;
building an addition, deck,
fence, retaining wall or
dock; a new furnace or
water heater; painting the
interior or exterior; laying
new sod or landscaping; and
the list goes on. Basically,
any improvements to an
eligible dwelling or dwellings, or the land on which
they sit, excluding routine
maintenance, qualify. If in
doubt, go to the Canada
Revenue Agency website
at www.cra-arc.gc.ca, scroll
to the bottom and click
Budget 2009 for more
information.
For cottages that are
jointly owned, by family
members for example, the
expenses can be divided
and claimed separately,
with each family eligible
for up to $1,350 on their
share of the improvements.
For example, Bob and
Jerry are brothers who,
with their families, own
equal stakes in the family cottage. Together they
incur $12,000 in kitchen
renovations for the cottage,
which cannot include the
cost of new appliances, and
$3,500 for a new dock. As
well, Jerry installs a new
furnace in his home at a
cost of $5,000. Bob makes
a claim for $6,750 ($7,750
– 1,000) for his share of
the cottage expenses and
receives a credit of 15
per cent of this amount
or $1,012.50 on his 2009
tax return. Jerry’s total
costs for home and cottage
come to $12,750 ($7,750
+ $5,000), so he claims a
$1,350 credit on the maximum allowable amount
of $9,000 ($10,000 –
1,000).
If you have any intention
of renovating in the near
future, 2009 is the year to
do it. To be eligible, goods
and services must be purchased after Jan. 27, 2009
and before Feb. 1, 2010.
It should be noted that
expenditures for projects
where an agreement was
entered into before Jan.
28, 2009 will not be eligible for the credit.
A little VANITY is a good
thing... call us and see the
best selection in Muskoka!
SPRING IS THE SEASON: Once the snow is finally gone, hammering and sawing will be
heard across Muskoka as people take advantage of the Home Renovation Tax Credit to
get the job done. Just don’t forget your bug gear, or hire out and let the professionals
deal with it. (Photo by Brett Thompson)
P R E S T IG E
R E NO VAT ION S
Carpentry n Contractor n Millworking
Residential n Commercial
Build New n Additions n Renovations
Restorations n Decks n Boathouses n Docks
Architectural Trim & Details
CADD
Custom Trim Milling Available
279 Manitoba Street, Bracebridge
and the ‘NEW’
Bathroom Design Centre at
North Muskoka House, 365 Hwy 60, Huntsville
645-2671
788-3800
a
R. James Cook
Muskoka and surrounding area
Ph: 705-801-5656 • Fax: 705-687-6178
Email: [email protected]
a