It was such an exciting experience to finally speak on Realtor Quest’s stage on Thursday.
I wouldn’t say that I was sharing a stage with Gary Vaynerchuk, but hey, my picture is on the same page as his on the promotional material!
Of course, armed with my speaker badge, I was hoping to get a picture with him. I waited and requested, I almost got it, but he decided not to take any pictures with anyone. Oh well, there’s always next time. 😉
A gentleman came by to my booth on the first day asking me an interesting question, ‘how long do my clients need to leave these new build homes vacant before they can rent them out and CRA would not go after them?’
Well, the fact that he has to ask me this question already meant that his clients do not qualify to claim the New Housing Rebate. The key is that the taxpayers must have the intention to use the new homes as their primary residence.
If they don’t have their intention, they don’t qualify.
This gentleman was upset, insisting that I didn’t answer his question. If his clients intend to rent it out, a simple solution is to pay for the HST rebate upfront. With a one year lease, his clients are eligible to claim the New Residential Rental Property Rebate.
Yes. There’s extra form to fill out, there’s extra filing requirement. But it takes 3 months from the day the application is submitted to when the taxpayer will get the rebate back.
And you can sleep at night, no CRA issues.
Why take the risk when you don’t need to?
Guess what, CRA is out trying to catch this type of non-compliance. According to this Toronto Star article, they have already got $1 billion from tax cheats in the real estate sector.
I would do it right and wait for the money to come back.
Let’s go Raptors!
Until next time, happy Canadian Real Estate Investing.
Cherry Chan, CPA, CA
Your Real Estate Accountant