The Canadian Government making home ownership more affordable

The Government of Canada's new Budget introduces policies designed to make Canadian homeownership more affordable.

Tax-free first home savings account (FHSA):

to save money to purchase a home.

The FHSA is a registered plan that is similar to a tax-free savings account or a retirement savings plan.

The FHSA plan will come into action in 2023!

Home buyers' tax credit:

As a first time home buyer you will also be able to claim a Home Buyers' Tax Credit when you purchase a home.

The Canadian Government doubles the credit in the new budget, so now first time home buyers are entitled to a credit on $10,000 which provides $1,500 in tax savings.

This was effective for eligible homebuyers on or after January 1st, 2022.

Home Accessibility Tax Credit:

This is for homebuyers 65 +, or anyone who is eligible to claim the Disability tax credit. You may be allowed some tax relief if renovations are made in order to improve accessibility in your home.

The Canadian Government's new budget will allow up to $20,000 of expenses to be claimed which will save federal taxes of 15% of the amount claimed (to a maximum of $3,000).

Multigenerational Home Renovation Tax Credit:

This is a new tax credit that can be claimed up tp $50,000 of costs to add a second living unit in a home to allow for a relative 65+ or someone with a disability, to live in a home.

They will save 15% of the amount claimed, a maximum of $7.500 in tax savings.

This credit will begin in 2023!

Foreign Buyers' Ban:

The Government of Canada has proposed restrictions for the next 2 years that will ban foreign commercial enterprises and people who are not Canadian citizens or permanent residences from buying non-recreational, residential properties in Canada.

This will encourage more housing to be owned by Canadians.

Those who purchase and flip homes for a profit will be taxed on profits as business income, rather than capital gains. This is only if the property is held for less than 12 months.

There are exemptions from this rule if the owner must sell for certain reasons including: a new job, death in the family, etc.

This new measure will apply to sales on or after January 1st, 2023.

Lucas Burns is now accredited with the Better Business Bureau!

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Happy June!!

613-298-1522

lburns@martelmortgages.ca