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Canada, 24th January: Is mortgage or HELOC interest tax deductible or not? That’s the question baffling many especially after the recent announcement by Jim Flaherty, the Canadian Finance Minister, that mortgage insurance on HELOC will not be available in Canada.
People who had taken mortgage or a HELOC (home equity lines of credit) have been consulting tax planners in Canada as to whether their interest (either full or in part) is subject to tax deductions or not.
As per the rules of the Income Tax Act, in case of money borrowed for getting investment income or business income, any interest paid by the borrowed on such amount is subject to tax deduction.
CRA Decision
Let us see a case referred to the CRA (Canada Revenue Agency) about the possibility of tax deductions on interest amount payments made by the borrower.
The case refers to a person wanting to purchase a new house in Canada and to rent out the home currently owned by him. The house valued at $700,000 has been paid off in full.
More info: www CanadaUpdates Com
People who had taken mortgage or a HELOC (home equity lines of credit) have been consulting tax planners in Canada as to whether their interest (either full or in part) is subject to tax deductions or not.
As per the rules of the Income Tax Act, in case of money borrowed for getting investment income or business income, any interest paid by the borrowed on such amount is subject to tax deduction.
CRA Decision
Let us see a case referred to the CRA (Canada Revenue Agency) about the possibility of tax deductions on interest amount payments made by the borrower.
The case refers to a person wanting to purchase a new house in Canada and to rent out the home currently owned by him. The house valued at $700,000 has been paid off in full.
More info: www CanadaUpdates Com
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