An individual purchased land in June 2009 and contracted to have a home constructed, which was completed in mid-November, 2009, at which point the individual moved in. Renovation work was completed in late November 2009, after the individual had moved into the home.
Can property acquired by the individual in September 2009 (i.e., before the individual became owner of the home – it did not yet exist) be eligible for the home renovation tax credit ("HRTC")? In responding affirmatively, CRA stated:
In the situation where an individual constructs the individual’s housing unit on land owned by the individual, it is generally the CRA's view that the individual will be considered to own a housing unit for HRTC purposes as soon as the housing unit is habitable. …
In other words, the housing unit will be an eligible dwelling (as defined in subsection 118.04(1)) if it became habitable at the time of the renovation or alteration and is ordinarily inhabited by the individual, by the individual’s spouse or common-law partner or former spouse or common-law partner or by a child of the individual during the period that begins on January 28, 2009 and that ends on January 31, 2010.
In the situation submitted, the housing unit would be an eligible dwelling of the individual as defined in subsection 118.04(1) as of mid-November. The individual in this situation will be considered to own the housing unit from mid-November 2009 or before that date if the accommodation was habitable before that date, and will ordinarily inhabit it during the period that begins on January 28, 2009 and that ends on January 31, 2010.