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Can you really benefit from your renovations? Think tax credits.

02 November 2018 by National Bank
Can you really benefit from your renovations? Think tax credits.

Do you love do-it-yourself projects and you’re the type to save money by doing renovations for your house or cottage by yourself? You may be missing out on generous tax credits and subventions, which are only available to Québec’s homeowners who entrust their work to a certified contractor.

Whether federal, provincial or municipal, many programs and incentives encourage homeowners to upgrade their homes to meet standards. Renos that have a positive impact on energy use or the environment are often accompanied by credits that allow the recovery of significant funds.

Step one: Do your research

Take time to do some research, particularly for your municipality and the area in which you live: programs can vary from one city to the next. Consider also that certain procedures and eligibility requirements apply, and that many programs are for a limited time. This is why it’s important to stay on the lookout. Starting some jobs sooner than later can be more profitable than waiting and risking missing out on a program.

Rénoclimat: Better financial comfort

The Rénoclimat program encourages renovations that reduce housing energy consumption.

Work can be done on the building envelope (insulation, sealing, etc.) or on certain mechanical systems (ventilation, heating, geothermal, boiler, etc.). Good news: Since March 2018, the replacement of doors and windows is also eligible under the Rénoclimat program.

In addition to profiting from financial aid, you could certainly profit from substantial long-term savings. In fact, it’s estimated you could lower your electricity bill by 20%.

Conserving energy pays off

Pay attention to offers from certain companies. Hydro-Québec supports, among other things, low-income housing with significant discounts. Énergir provides a grant for renovations that improve the thermal envelope of buildings, such as replacing windows and insulating walls or the roof. In Outauais, Gazifère offers rebates and financing to encourage the installation of new natural-gas appliances. The Chauffez vert program also provides financial aid to homeowners who replace their central heating system or their boiler using a fossil fuel other than natural gas (e.g., fuel oil or propane).

Other credit: Updating residential waste water treatment

The tax credit for the upgrading of residential waste water treatment systems provides financial aid to homeowners who wish under take the repair of their septic systems.

The APCHQ website summarizes the main eligibility criteria for the tax credit, with a reminder that the credit is available until the end of the 2022 tax year. Many cottage or residence owners who are not connected to the water system therefore have the benefit of profiting from it, too. Remember, also, that the work must be carried out by a certified contractor that holds an “Independent Contractor in Sewage Systems” licence from the Régie du bâtiment du Québec (RBQ).

Municipal subsidies

Even if they’re not directly related to tax credits, many available municipal subsidies can help your renovation work be profitable. Some examples? In Montreal, there are two renovation programs (à la carte or major) and the Stabilization of Residential Building Foundations program. Quebec City also proposes many options for owners of a heritage property.

Renos and taxes: Complementary strategies

Note that certain eligible expenses can be deducted from the amount if you benefit from financial aid from another program. That is why it’s in your best interest to do your research right from the start to adopt the most effective strategy and avoid unpleasant surprises.

Do your calculations before starting renovations, and don’t forget to work with experts and certified contractors to be eligible for the most benefits possible. These tax credits could really save you time and money. A National Bank financial advisor is also a good ally to help you determine the optimal choice. Using the best strategies allows you to get other tax savings during your renovations.

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