The April 30 deadline for filing your income taxes is fast approaching. When you are gathering your receipts and papers, you’ll need to review your actions from last year to make sure that you don’t miss any of the deductions to which you would be entitled.
Doing a review of the important events in your life in 2013 will help to make sure that you don’t miss anything. You’ll want to cover off things like child care and moving expenses when you prepare your return. Canada’s Economic Action plan also includes a First-Time Home Buyer’s Tax Credit (HBTC) to help taxpayers with the purchase of their first home. If you bought your first home in 2013 or are planning to buy in 2014, you’ll want to be aware of this important information.
First Time Home Buyers’ Tax Credit
The HBTC was introduced by the federal government was a way to help home buyers with some of the costs associated with buying a home. Along with the purchase price, you also need budget for things like legal fees and disbursements from your lawyer, and the land transfer tax. These additional amounts, along with the required down payment, can present an additional financial burden to first-time home buyers.
The HBTC is a $5,000 non-refundable tax credit, which provides a net tax benefit of up to $750 to those who qualify. A person is considered a first-time buyer if neither he or she or his spouse or common-partner has owned and lived in another home in the year the home was purchased or any of the preceding four calendar years.
The unused portion of a person’s HBTC can be claimed by his or her spouse or common-law partner. To find out whether this would be to your advantage, consult with an accountant or use special tax preparation software to look at the outcome if each person were to claim the entire amount of the tax credit and then if it were to be split.
Spring is a Great Time to Look for a New GTA Home
Now that the warmer weather has arrived, it’s a great time to get out and start looking for your first home. With the added incentive of the HBTC, which will give you a break on your income tax return, what are you waiting for?