Last-minute Projects for the Home Renovation Tax Credit

It's time to stop procrastinating and get to the hardware store before the HRTC ends on Feb. 1. We've compiled a list of projects that can help you maximize your credit — and improve your home.

The Canadian government, to be sure, loves its red tape. Witness any DMV line-up or municipal zoning bylaw as proof. But for all the hassle they put us through, the feds can sometimes deliver on a great program. Consider the Home Renovation Tax Credit (HRTC), which provides Canadians with a non-refundable tax credit on certain home improvement expenses (up to $10,000). This program will end, however, on Feb. 1, so you need to act fast. We've come up with eight projects that you could still fit in to earn your credit.

For the Canada Revenue Agency's HRTC information page, click here


Replace your water heater

Approx. cost: $1,000
HRTC credit: $150

Water heaters range in cost, but units found at a big box store like Rona carry a ballpark tag of around $400. Add in the price of labour to a) remove your old unit and b) install a new one, and it's easy to see how your project costs could bulge to about a thousand dollars, netting you a $150 tax credit. For the more industrious handyman/woman, though, doing it yourself can save about half that. Accounting for the unit price, retail tax and materials to complete the installation, Canadians who take this route can expect an HRTC of about $75.

Electrical wiring upgrade (100 amps to 200 amps)

Approx. cost: $1,500 HRTC credit: $225

The benefits to improving the electrical wiring in your home are plentiful: greater load capacity, the ability to run more appliances/electronics at once, increased resale value of your property, etc. But upgrading from a 100 amp to a 200 amp service will be pricey, a deterrent that likely pushes many Canadians away from the switch. Yet what eases that blow is a tax credit of more than $200, which could be used toward providing your electrician with higher-quality materials to complete the job.

New living room carpet

Approx. cost: $667
HRTC credit: $101

The above calculation shows what you might spend on new carpet, with underpadding, for a modest-sized living room (about 300 square feet). While this scenario presumes you've chosen a synthetic carpet, expect to shell out a good deal more if you'd prefer natural wool. Natural wool can run you as much as $6 per square foot, making carpeting the same-sized room a $1,834 undertaking (underpadding included), eligible for a $275 HRTC.

Bathroom renovation

Approx. cost: $9,000
HRTC credit: $1,350

It's said that, when done properly, homeowners can recover the full cost of a bathroom reno should they sell the property. Of course, what that cost is depends on the size of your loo. According to OntarioContractors.com, a "complete bathroom renovation" would run at least $9,000, supplies and labour included. While this is one of the more ambitious projects on this list, even if your costs climb, you'll still be eligible for a near-max government credit of $1,350.

For more Bathroom renovation ideas,click here

Central air conditioning

Approx. cost: $3,000
HRTC credit: $450

Few Canadians want to hear anything about A/C in January. But let's think ahead a bit; the HRTC applies to all expenses levied before Feb. 1, 2010. At the very least you can receive a tax credit on the unit, though if you can find someone to install the new central A/C before the end of the month, that labour cost can be put toward the HRTC, too. While you may not fire the thing up much until summer, keep in mind some high-efficiency A/C units may be eligible for further government credits through Canada's ecoENERGY Retrofit program,click here

Home security system

Approx. cost: $400*
HRTC credit: $60

Not every renovation has to involve foremen and construction crews to be eligible for the HRTC. In fact, it doesn't have to cost thousands of dollars, either. The installation of a new home security system (subsequent monthly fees do not qualify) is a good example of what low-cost initiatives can produce a tax credit in return. The price quoted above covers the installation of the "Critical Conditions" package from ADT Canada. Under this plan, users' homes would be monitored for burglary, fire, carbon monoxide and flooding.

Interior painting

Approx. cost: $3,000
HRTC credit: $450

With so many variables, it's tough to quote once-and-for-all what painting your home will cost. But let's start by presuming you don't want to do it yourself. Generally, professional painters will charge you around $1 per square foot of your home, not including the cost of paint. The above scenario suggests you have a 2,500 square foot house, and paid an extra $500 for the actual paint. Though if you are a go-getter, ballpark the cost of painting on your own at about $600 ($500 paint plus $100 in supplies), eligible for a $90 HRTC. With the benefit of the tax credit, home renovators could even splurge on more expensive, higher-quality paint.

Kitchen renovation

Approx. cost: $7,000
HRTC credit: $1,050

A major project like renovating your kitchen is a good example of how you don't necessarily have to finish a job by Feb. 1 to cash in on the HRTC. The tax credit applies to all materials and labour charged before the end of the month, so — again — if you can fit the bulk of your reno spending in while the calendar still reads "January," you should be covered for this tax year. At a start price of $7,000, OntarioContractors.com quotes a "full" kitchen renovation as surprisingly less than that of a bathroom (which begins at a cost of $9,000, according to the site), including labour and supplies. Adjust the above calculation accordingly by the size and condition of your existing kitchen.