PERSONAL CHOICE MORTGAGE SERVICES INC. NEWSLETTER | April 2017

Why this housing tax break is so important to Canadians
 
(NC) For the 70 per cent of Canadians who own a home, it is a place to live, raise our family, and it connects us to our community.Due to Canada’s tax system’s Principal Residence Exemption, when we sell our homes, any increased value or “capital gains” are not taxed.

This generous tax break matters to Canadian homeowners. Collectively, we have about $3 trillion in home equity and our homes are often our largest financial asset.

However, starting with our 2016 income tax returns, there are some changes in how homeowners qualify for the Principal Residence Exemption.

Until now, the Canada Revenue Agency has not required Canadians to report on a home sale when during tax season. If you sold your home in 2016 or later, you will need to complete a Schedule 3, Capital Gains of the T1 Income Tax and Benefit Return in order to report your sale.

The good news is that, in terms of taxes, nothing has changed. The same tax benefit is available to anyone who sells their home, provided the property was the principal residence for every year you owned it – even if you use part of your home for business purposes. There is no “new tax” involved – only a requirement that we report the sale details on our tax returns.

So, if there is still no tax to pay, why the extra paperwork?

When it comes to taxes, not everyone plays by the rules. The Principal Residence Exemption is a very generous tax break and it is occasionally misused by those involved in speculative “house flipping” in order to evade taxes on their profits. In these cases, people were claiming the exemption for homes they owned, but may never have lived in. Reporting these sales allows the government to make sure that only eligible homeowners get the benefit that they are entitled to.

So, if you sold you home in 2016, make sure to report the sale when you file your 2016 tax return. You will still get the same tax break and you will help prevent the misuse of this important homeowner tax benefit.

www.newscanada.com


3 tips to green your home for spring
 
(NC) Creating a more eco-friendly home and lifestyle is a great goal for the change of season, especially with warmer weather encouraging us to spend more time outdoors. Here are some tips in and around your home to help get you started:1. In your everyday spaces: Look for simple changes you can make to reduce your impact on the environment. Shop for eco-friendly products, upcycle old furniture in a DIY project, and donate old clothing or use it for crafts. Make sure to recycle as much as you can, and use energy during off-peak times as much as possible.

2. In the garden: Consider compost gardening, which involves composting leftover foods and scraps and then using it to fertilize your own crops and herbs. It’s easier than you think and makes a great project and learning experience you can do with the kids. There is tons of advice online, including how to make your own compost garden even if you live in a condo or have limited backyard space.

3. In the garage: One of the easiest ways to make an impact on your personal carbon footprint is by looking at your vehicle and driving habits. Consider an electric or hybrid vehicle for increased fuel efficiency and lower greenhouse gas emissions. By driving green, you could save hundreds of dollars at the pump each year and stay on trend. Remember to accelerate gently, maintain a steady speed, anticipate traffic, avoid high speeds and coast to decelerate. Find more information at www.vehicles.gc.ca.

www.newscanada.com


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