If you don’t know about the rebates, grants, and incentives available to help you stay in your home, you may be missing out or putting off necessary renovations.
By Olev Edur
Here’s some good news for retirees struggling to hold on to their homes but finding the costs, especially for maintenance and essential updates, becoming too much: help is out there. The federal government, some provinces and municipalities, and even utilities such as Enbridge and BC Hydro now provide home-related tax breaks and other financial incentives to help relieve the pressures on your pocketbook.
Many of these programs are designed to make your home more energy efficient, so in making necessary improvements you get a double bonus: the incentives help defray your costs—sometimes by thousands of dollars—and you also see your monthly heating and cooling bills subside. In addition, many provinces and cities have introduced programs in recent years to help retirees cope with their property tax bills, either by offering offsetting grants or by allowing you to defer payments until you sell.
Good Times has compiled the following as examples of what’s available, although space precludes a comprehensive list. There may be many other similar programs run by cities across Canada or by provinces not mentioned here, so if you’re facing house expenditures, check with your local authorities beforehand, because the payback can be well worth the effort.
By the same token, bear in mind that some improvements may be claimable as home-related and medical expense credits, and some expenses may be eligible for two different home-related programs.
Home Accessibility Tax Credit (HATC)
This federal program provides tax credits of up to $10,000 a year for eligible renovation expenses and is available to those aged 65-plus—as well as to anyone eligible for the disability tax credit, anyone claiming an amount for eligible dependants or the caregiver amount, the spouses or common-law partners of anyone eligible, and others who claim these amounts if they’re not claimed by a spouse/partner.
Qualifying renovations and expenses must be permanent and integral to the eligible dwelling (up to a half-hectare (1.24 acres) of land is considered part of the dwelling) and must “allow the qualifying individual to gain access to, or to be mobile or functional within, the dwelling” or “reduce the risk of harm to the qualifying individual” while inside or accessing the home.
Generally, all paid work done by professionals qualifies for the credit; eligible expenses for work done by yourself include plans and permits, building materials, and fixtures and equipment rentals, but not labour and/or tool purchases. Expenses aren’t eligible if the material and/or labour is supplied by a relative unless he or she is registered for the goods and services tax/harmonized sales tax (GST/HST).
To claim home accessibility expenses, you have to complete Schedule 12, Home Accessibility Expenses, and report the amount from Line 4 of Schedule 12 on Line 398 of Schedule 1 of your federal tax return. A qualifying expense may also qualify as a medical expense—you may be able to claim it as both a medical expense and a home accessibility expense.
Expense claims must be supported by documentation such as agreements, invoices, and receipts, clearly identifying the type and quantity of goods bought or services provided, costs, vendor GST/HST numbers, and dates. In the case of co-ops or condos, you need a statement signed by an authorized person from the co-op housing corporation or condominium corporation (or, for civil law, a syndicate of co-owners) detailing the relevant information.
RénoVert Refundable Tax Credit (Quebec)
This refundable credit (meaning, you can get cash back if your tax is less than your credit) is available until the end of 2019 and is intended to encourage people to invest in “recognized eco-friendly home renovation work that has a positive environmental impact and improves your dwelling’s energy efficiency.” You can claim the credit for work done on a dwelling you own or co-own that is your principal residence or on a winterized cottage that you normally occupy. It can be a single-family home, a permanently installed prefab or mobile home, a condo, an apartment, or a cottage, provided the building was completed before 2016.
The maximum tax credit you can claim for the period from 2016 through 2019 is $10,000. This corresponds to 20 per cent of the portion of your qualified expenditures paid between March 17, 2016, and January 1, 2020, that exceeds $2,500. The renovation work must have been done by a qualified contractor under a contract entered into after March 17, 2016, and before April 1, 2019.
Qualifying expenditures include:
– the cost of any permits, including studies to obtain permits;
– the cost (including taxes) of goods used to carry out the work, provided they were supplied by the contractor or acquired from a QST-registered supplier after March 17, 2016;
– the cost (including taxes) of services rendered by the contractor;
– the cost of any necessary cleanup.
So, for example, qualifying expenditures for the insulation of a basement include those related to demolition and finishing, as well as expenditures incurred to purchase GREENGUARD- or EcoLogo-certified insulation materials, lumber, drywall, vapour barriers, nails, subflooring, flooring, paint, and plaster.
In addition to the RénoVert credit, you may be eligible (until March 31, 2021) for financial assistance under this program run by Transition Énergétique Québec if you are: carrying out insulation work; doing work affecting your home’s air tightness; replacing doors and windows; or installing or replacing mechanical systems (such as a ventilation system, water heater, heat pump, and geothermal heating system).
Rénoclimat will guide you through your home renovation project, starting with an evaluation (at a reduced price) and advice on improving the energy efficiency of your home. The financial assistance, combined with recurrent energy savings, has on average helped participants to save 20 per cent on their heating bills after renovations were completed.
BC Home Renovation Tax Credit for Seniors and Persons With Disabilities
This BC government tax credit program is available to seniors and to family members who are sharing their home, whether the home is rented or owned. The maximum credit is $1,000 annually, calculated as 10 per cent of eligible permanent home renovation expenditures, for costs incurred on or after April 1, 2012. In 2016, the tax credit was expanded to include those with disabilities who are eligible to claim the federal disability tax credit, as well as to family members living with those persons.
The expenditure must be part of a renovation or alteration of a “qualifying principal residence” or the land on which the residence is situated if it’s undertaken to provide the senior improved access, mobility, and safety.
The renovation can include the purchase and installation of such things as handrails, grab bars, walk-in bathtubs, wheel-in showers, non-slip flooring in the bathroom, raised toilets, motion-activated lighting, and wheelchair ramps, lifts, and elevators. Other renovations can include widening passage doors, replacing door handles and locks, lowering existing counters and cupboards, relocating light switches and electrical outlets, adding additional light fixtures throughout the home and exterior entrances, and more.
BC Hydro Energy Rebates
BC Hydro (and in some cases, other organizations) offers a number of cash rebates available for British Columbians who want to improve the energy efficiency of their homes, including rebates for:
– insulation (up to $1,200; requires installation by a licensed contractor);
– ductless heat pumps ($800, with additional rebates currently available on select products);
– draftproofing (up to $500);
– natural gas hot water heaters (rebate provided by FortisBC);
– EnerChoice fireplaces (rebate provided by FortisBC);
– Energy Coach Home evaluation ($150 rebate provided by the province).
A $750 bonus offer is available if you make three or more eligible upgrades.
The rebate program is available to residential customers in the BC Hydro and/or FortisBC service territory who use electricity or natural gas as the primary heating fuel for their home and have a minimum 12-month utility billing history. The program applies to single-family detached homes, duplexes, row houses, and townhouses, and to mobile homes on a permanent foundation.
New Brunswick Seniors’ Home Renovation Tax Credit
This refundable tax credit, available to senior New Brunswick residents and/or family members living with them, is for renovations to your principal residence and amounts to 10 per cent of eligible renovation expenses up to a maximum credit of $1,000. Eligible renovation expenses are renovations or alterations that help a senior by improving access, mobility, and safety.
Enbridge Gas Home Energy Conservation Program (Ontario)
This home energy conservation program provides various rebates totalling up to $5,000 on home energy-related improvements and replacements. Included are:
– heating systems (up to $1,000 rebate);
– insulation (up to $1,750 rebate per installation);
– air sealing (up to $150 rebate);
– water heaters ($500 rebate);
– windows/doors ($80 rebate per rough opening);
– qualifying wood-burning replacement systems (up to $750 rebate);
– appliances (up to $75 rebate per appliance);
– air-source heat pump (up to $5,550 rebate per unit);
– central air conditioners ($600 rebate).
When you complete more than two upgrades, you also qualify for a $250 bonus (as part of the $5,000 overall incentive) for each additional upgrade, to a maximum of $750; when you complete a minimum of two upgrades, you may also receive additional incentives for electrical upgrades such as for heating and cooling, appliances, and air-source heat pumps.
If you implement a minimum of two recommended and qualifying energy upgrades, you can receive up to $5,000 plus a chance to qualify for further electrical incentives; a bonus of up to $5,500 is available for installing an air-source heat pump in electrically heated homes. Furthermore, while the two required energy audits cost a total of $678 (including HST), $600 can be reimbursed at the end of the program. Enbridge customers in Durham Region and Peterborough may also qualify for the home-winterproofing program, which provides free insulation and draftproofing, as well as free home-energy assessments.
Toronto Home Energy Loan Program (HELP)
HELP is a financing tool offered by the City of Toronto to help you improve your home’s energy efficiency and save money by, for example, upgrading your insulation or replacing an old furnace—projects where the high upfront cost may be a barrier to taking action. You may qualify for a low-interest loan through HELP if:
– you own a row house or a detached, semi-detached, or mobile home in Toronto;
– all of the property owners on the title consent to the program;
– your property tax and utility payments to the city are in good standing;
– you obtain written consent from your mortgage lender, if applicable.
The potential savings you may realize after completing your home energy retrofit can help offset the cost of your monthly repayments to the city. Plus, you can take advantage of incentives from utility companies (such as Enbridge) to further reduce your costs. Eligible home energy upgrades can include:
– high-efficiency furnace/boilers;
– high-efficiency central air conditioning;
– high-efficiency water heaters;
– heat-recovery or energy-recovery systems;
– window/door replacements;
– air sealing (i.e., weatherstripping, caulking);
– attic insulation;
– exterior wall insulation;
– basement insulation.
In addition to these home repair and renovation programs, many provinces and municipalities now offer assistance to retired homeowners with respect to their taxes, either in the form of grants and/or credits or tax deferrals. The following are some examples.
Home Owner Grant for Seniors (British Columbia)
The BC homeowner grant reduces the amount of property tax you pay each year on your principal residence. If you’re a senior aged 65 or older and you meet certain requirements, you may be eligible for the additional grant of $275 on top of the regular grant of $570. The total grant amount for seniors aged 65 or older is $845 in the Capital Regional District, Greater Vancouver Regional District, and the Fraser Valley. For all other areas of the province, the total grant amount for seniors aged 65 or older is $1,045.
You must pay at least $100 in property taxes before claiming the homeowner grant in order to help fund services such as road maintenance and police protection. To qualify, you must be a Canadian citizen or permanent resident living in British Columbia, be the registered owner of the home and use it as your principal residence, and be 65 or older.
There’s a grant threshold based on the value of the property, meaning that you may be able to claim the full grant if your property is worth $1,650,000 or less (this figure is reviewed annually). If you meet all requirements but your property value is more than $1,650,000, your grant will be reduced by $5 for each $1,000 of assessed value over $1,650,000 (to a limit of $1,819,000, or of $1,859,000 in northern and rural areas). If you own a property with an assessed value of more than $1,650,000 and have an adjusted net income of $32,000 or less, you may qualify for a low-income grant supplement for seniors.
Defer Your Property Taxes (British Columbia)
British Columbia also offers property tax deferment in the form of a low-interest loan program that helps qualified homeowners pay their taxes on a principal residence. You may qualify if you are 55 or older during the current year, a surviving spouse of any age, or a person with disabilities. Check your annual property tax notice to see if you qualify and if so, send in an application (your deferment must be renewed each year).
Seniors Property Tax Deferral Program (Alberta)
This program allows eligible senior homeowners to defer all or part of their property taxes through a low-interest home equity loan with the Alberta government. If you qualify, the Alberta government will pay your residential property taxes on your behalf, and you repay the loan plus interest (the current rate is 3.45 per cent) when you sell the home. To qualify, you must be an Alberta resident aged 65 or older, own a residential property in Alberta, and have a minimum of 25 per cent equity in your home.
Ontario Senior Homeowners’ Property Tax Grant
This grant program is designed to help low-to-moderate-income seniors with the cost of their property taxes. You (or your spouse/partner) can qualify for this grant if you are an Ontario resident aged 64 or older, own and occupy a principal residence and pay Ontario property tax on it, and you’re single and earn less than $50,000 annually or in a couple earning less than $60,000 a year.
If you file your tax return annually and qualify, you could get a grant of up to $500 each year, depending on income. Singles earning $35,000 or less get the full $500, while those earning more (up to $50,000) see the grant reduced by 3.33 per cent of income above $35,000. Couples earning $45,000 or less get $500, with the same reduction up to $60,000 of income.
You need to file your tax return to apply for this grant and you may qualify even if you have no income or owe no tax.
To apply, complete the ON-BEN application form (part of your tax return) and report the amount of property tax you paid on Line 6112.
Ontario Energy and Property Tax Credit
This credit is a tax-free payment to help you with your property taxes and sales tax on energy costs.
To qualify, you must be an Ontario resident over age 18, currently or previously married or in a common-law relationship, and, in the previous year, you must have rented or paid property tax for your main residence, lived on a reserve and paid for your home-energy costs, or lived in a public long-term-care home (e.g., a seniors’ home) and paid for your accommodations. For 2018, the maximum grant is $1,187 if you are over 65 and $232 if you live on a reserve or in a public long-term-care home.
Provincial Land Tax Deferral Program for Low-Income Seniors and Low-Income Persons With Disabilities (Ontario)
Low-income seniors and low-income persons with disabilities can get a deferral of any increase in their provincial land tax and education tax (provincial land tax is levied on land located in non-municipal areas). You can claim this deferral if you owned residential/farm property that was used as your principal residence for at least one year preceding the application and are a low-income person who received a benefit from the Ontario Disability Support Program (ODSP) or are a low-income senior and received a Guaranteed Income Supplement (GIS) benefit.
Property Tax Increase Cancellation or Deferral Programs (Toronto)
If you are a low-income senior or a low-income person living with a disability, you can apply for a cancellation of property tax increases or for a deferral; in the latter case, the total deferral amount must be paid back to the city if you cease to own the property.
To qualify for a cancellation of a property tax increase, you must have a combined household income of $40,207 or less, have a residential assessment of $850,000 or less, and be 65 or older (or be 60–64 years of age and getting GIS benefits) or be living with a disability and getting disability benefits.
To qualify for a deferral, you must have a combined household income of $50,000 or less, be 65 or older (or be 60–64 and receiving GIS) or be 50 or older and receiving either a pension or a pension annuity, or be living with a disability and receiving disability benefits.
Water Rebate Program (Toronto)
If you’re a low-income senior or a low-income person living with a disability who uses less than 400 cubic metres of water each year, you can apply for a water rebate. The City of Toronto will calculate your annual water consumption and if you meet eligibility criteria, a rebate will be applied to your utility bill the following year.
To qualify, you must have metered service, your tax and water/utility accounts must be paid in full, you must meet the same age/income criteria as for a property tax deferral, and you must have owned and occupied the property as your principal residence for one year or longer.
Halifax Property Tax Exemption and Deferral Program
To qualify for this program, homeowners must have a combined annual salary of less than $32,000 and own a home in Halifax. Qualifying homeowners can pay property tax through a payment plan or a property tax rebate or deferral, and can make payments at any time; the debt is collected when ownership is transferred to another owner, but the total amount deferred on a property cannot exceed 75 per cent of the assessed value of the property.
Editor’s note: As a result of the Ontario election in June and the new premier’s commitment to reversing the province’s erstwhile “green agenda,” some or even all of the Ontario home energy-saving programs listed here may be altered or eliminated. Always double-check with the government before taking any action based on receiving compensation—whether through grants, loans, or tax credits—from any of these programs.