Here is a little advantage for First Time Home Buyers that just came into effect at the end of 2022. The increase for the claim amount went from $5000 to $10,000 for a maximum deduction depending on income level of $1500 in benefit. Hey its something! Read on for more info. This article gives more clarity to this little advantage! Talk soon - Kelly Johnston 604-701-9080 eXp Realty
The First-Time Home Buyers’ Tax Credit, also known as the HBTC, is a federal government initiative to make homeownership more affordable for some Canadians. After the passage of new legislation in December of 2022, eligible first-time home buyers can claim a $10,000 non-refundable income tax credit — double what they could before — which could result in tax savings of up to $1,500.
Author of Article
How the First-Time Home Buyers’ Tax Credit worksClaiming the HBTC is as straightforward as it gets. There’s no need to apply or be approved.When it comes time to do your taxes, enter the Home Buyer’s Amount of $10,000 on Line 31270 of your income tax return. The government allows you to split the amount with your spouse or common-law partner, but your combined total claims must not exceed $10,000. The credit results in a $1,500 rebate on the taxes you owe for the year. The amount is calculated at the lowest personal tax rate, which is presently 15%.If you owe less than $1,500 in taxes for the year, you can only reduce your taxes to $0. You won’t get an additional refund as this is a non-refundable tax credit. Be sure to keep all your home buying documentation in case the CRA requires proof of eligibility.
HBTC eligibilityTo be eligible to claim the HBTC, you (or your spouse or common-law partner) must:
- Buy a qualifying home registered in your (or your spouse’s or common-law partner’s) name. It can be an existing property or under construction and includes single-family structures, townhouses, condo units and more.
- Be a first-time home owner, meaning that you did not reside in a property that you or your spouse or common-law partner owned in the previous four years.
- The qualifying home must become your principal place of residence within one year after it’s bought or constructed.
Author of Article