January 6, 2023 | Real Estate News
Canadian Housing Initiatives To Expect In 2023
The Canadian Government introduced some new housing policies that came into place on January 1st or are coming this Spring. To make it easier to keep up with these, we’ve listed them below:
Two-Year Ban on Non-Canadians Purchasing Residential Property
This regulation for this two-year ban was released on December 21, 2022, and it includes definitions, exceptions, and enforcement elements to help better understand the ban.
We’ve explained this in more detail here.
Residential Property Flipping Rule
This measure applies to residential properties sold on or after January 1st. It ensures that profits made from flipping residential properties are subject to full taxation. More specifically, profits made from the sale of a residential property that was owned for less than 12 months would classify as business income, including rental properties.
‘Flipped property’ is defined by Bill C-32 as: “a housing unit of a taxpayer located in Canada that was owned by the taxpayer for less than 365 consecutive days (less than a year) prior to the disposition of the property”.
The Government of Canada provides in-depth detail here.
Multigenerational Home Renovation Tax Credit
This is a refundable tax credit that allows families to claim up to $7,500 to build a secondary unit in their home to accommodate seniors or adults with disabilities.
Full details for the Multigenerational Home Renovation Tax Credit can be found here.
Tax-Free First Home Savings Account (FHSA)
The Canadian Government is working with financial institutions to give the opportunity for potential first-time home buyers to open an FHSA and make contributions in 2023. We can expect this measure to be put into force in April 2023.
The FHSA is formatted to give first-time home buyers the ability to save $40,000 on a tax-free basis with an annual contribution limit of $8,000.
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