Are you a Canadian planning or in the middle of a home renovation project to make your home or a family member’s home more accessible? You may be eligible for the federal Home Accessibility Tax Credit (HATC) to save up to $3,000.
What is the Home Accessibility Tax Credit (HATC)?
The HATC is a non-refundable tax credit worth up to $3,000. Qualified or eligible individuals in Canada can receive 15% in tax relief on up to $20,000 in eligible renovations. The tax credit took effect in 2016 and is an annual tax deduction. This means you can qualify for the full amount each tax season, if you continue with additional eligible renovations.
Who qualifies for the HATC?
Qualifying individuals are 65 years of age or older at the end of the year, or individuals who are eligible for the disability tax credit (DTC) at any time in the year.
Eligible individuals are the family of a qualified individual, like a spouse, child or sibling of the person that will be benefiting from the renovations.
Is your home eligible for the HATC?
The primary residence, if owned fully or jointly by the qualifying or eligible individual is eligible.
Other possible eligible dwellings are the homes of caretakers who support qualified individuals. If a caretaker owns their home and the qualified individual ordinarily lives there or will live there, it likely qualifies.
For example, if the daughter of the qualifying individual is paying to renovate her home so her dad can move in, then the daughter is eligible for the tax credit.
There are a handful of scenarios that would meet the requirements. Be sure to check the full details with Canada Revenue Agency.
What renovations qualify for the Home Accessibility Tax Credit?
Generally, if the renovation is permanent and either helps you access your home or reduces your chance of injury, then it should qualify. The expenses must be for work performed and goods acquired in the tax year.
Examples of renovations that likely qualify:
- Installing Grab bars and safety rails
- Wheelchair roll-in shower units
- Accessible shower pans
- Install a wall mounted shower seat
- Wheelchair lifts
- Widening your doorways
- Permits for construction
- Labour costs from professionals
- Equipment rentals, and more.
Renovations that don’t qualify:
- The cost of maintenance or repairs
- Labour costs from family members or yourself*
- Furniture or household appliances
- Electronic home-entertainment devices
- Housekeeping, gardening, or security costs, and more.
- Amounts paid to acquire a property
- Financing costs
*Note: If you do the work yourself, you can still claim eligible expenses, like building materials, fixtures, equipment rentals, building plans and permits, but the value of your labour cannot be claimed.
Goods and services provided by a family member is not eligible unless that person is registered for GST/HST.
How to claim the tax credit
Remember, if there is more than one eligible individual claiming the tax credit, the total eligible expenses for a dwelling cannot be more than $20,000. The claim can be split, but make sure all claimants agree on the split amounts, otherwise, the CRA will determine the amounts.
Make sure you keep invoices, receipts, and agreements. Documents must include:
- Information identifying the vendor/contractor, including their business address and GST/HST registration number.
- Description of goods and the date they were purchased
- Date the goods were delivered, or when the work or services were performed
- Description of the work done, including the address where it was done
- The amount of the invoice
- Proof of payment
Other notes about the Home Accessibility Tax Credit
Condo and Co-operative housing
You share of the cost of eligible expenses for common areas qualifies for HATC.
Business and rental use of part of an eligible dwelling
If you earn business or rental income from part of an eligible dwelling, you can only claim the amount for eligible expenses that is incurred for the personal-use areas of your dwelling. For expenses incurred for common areas, you must divide the expense between personal use and income-earning use.
Other credits and rebates
HATC is not reduced by government assistance, including grants, forgivable loans or tax credits from federal or provincial or territorial government.
How to save even more money
From CRA: Medical expense tax credit (METC)
If you have an eligible expense that also qualifies as a medical expense, you can claim the expense as a medical expense and a home accessibility expense. For more information about medical expenses, see lines 33099 and 33199.
An example of an expense that would be eligible for both the METC and HATC is the purchase of bathroom aids, like grab bars, vertical wheelchair lift, even the renovation or construction expenses related to providing greater mobility or function within for those with prolonged mobility impairment.
Note some of these may require a prescription to be eligible as a medical expense.
Other possible tax relief may be available at a provincial level. Here are some examples:
British Columbia – Home renovation tax credit for seniors and persons with disabilities
New Brunswick – New Brunswick Seniors’ Home Renovation Tax Credit
Saskatchewan – Home Renovation Tax Credit
Canada –Multigenerational Home Renovation Tax Credit (not eligible in combination with the HATC or METC)
Tax relief is always welcome, especially when it comes to age-proofing your home so you can age-in-place. Take advantage of the Home Accessibility Tax Credit while it’s available to install an accessible shower, grab bars or a wheelchair lift. We hope you enjoyed reading and we wish you luck in your accessible renovations.
Do you have any experience with the Home Accessibility Tax Credit? What accessible renovation would you use the tax credit on? Any questions? We’d love to hear from you.
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The information provided on this website is for informational purposes only and is not intended to provide specific financial, investment, tax, legal, accounting or other advice to you, and should not be acted or relied upon in that regard without seeking the advice of a professional.