Landlords & property
Rental income goes on form T776, and two mistakes cost landlords more than all the others combined. The first is claiming the whole mortgage payment: only the interest portion is deductible, never the principal. The second is the difference between a repair and an improvement — fixing a broken furnace is deductible this year, replacing it with a better one is a capital cost claimed slowly over time. Getting these right is the difference between a return that holds up under review and one that does not.
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This is the single most common error we see. Your monthly payment is part interest and part principal, and only the interest is a deductible expense. Your lender's annual statement splits it out — that is the document to bring.
Property tax, condo fees, insurance and utilities you pay are all deductible in the normal way.
A repair keeps the property in the condition it was already in and is deducted in full this year. An improvement makes it better or extends its life, and is treated as a capital cost claimed gradually.
Patching a roof is a repair. Replacing the roof is usually capital. Repainting is a repair; a new kitchen is not. When it is genuinely borderline, we make the call with you and document the reasoning.
You can claim depreciation on the building itself, and sometimes it is the right move. But it has consequences: claiming it can trigger a recapture charge when you sell, and where you rent out part of your own home it can put your principal residence exemption at risk.
This is a decision, not a default. We will tell you what it saves now and what it may cost later, and let you choose with the full picture.
If you own with a spouse or family member, the income and expenses are split according to actual ownership share, not whichever split is convenient. If you rent out a basement or a room, expenses are apportioned by the share of the home rented out. Both are areas the CRA looks at, and both are straightforward when set up properly from the start.
What it costs. Rental income returns start at $100 for one property, added to your personal return. Additional properties are extra. Selling an investment property adds $40. Your price is confirmed before we begin.
See the full price listNo — only the interest portion. The principal is not deductible. Your lender's annual statement shows the split, and that is the figure we use.
Patching an existing roof is generally a repair and deducted this year. A full replacement is usually a capital expense claimed over time. We assess the specific work and document the basis.
Sometimes, but not automatically. It reduces tax now and can create a recapture charge on sale, and it can affect your principal residence exemption if you rent part of your own home. We show you both sides before deciding.
By your actual ownership share. If you each own half, each reports half the income and half the expenses — it cannot be assigned to whoever is in the lower bracket.
Yes, and it is very common. You report the rent and claim a reasonable share of the home's costs based on the space rented out.
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