Home Renovation Tax Credit (SK)

by Hasan Sharif

Allows Saskatchewan homeowners to save up to $2,100 in provincial income tax by claiming a 10.5% tax credit on up to $20,000 of eligible home renovation expenses.

Applies to Saskatchewan Residents only.

Under this non-refundable tax credit, Saskatchewan homeowners may save up to $2,100 in provincial income tax by claiming a 10.5 per cent tax credit on up to $20,000 of eligible home renovation expenses. Eligible expenses include the cost of labour and professional services, building materials, fixtures, equipment rentals, and permits.

This tax credit is administered by the Canada Revenue Agency (CRA) as part of the Saskatchewan personal income tax system. The tax credit can be claimed through your annual tax return.

To learn more, contact the Canada Revenue Agency directly at Phone: 1‑800‑959‑8281 (English) or 1‑800‑959‑7383 (French).

1. To Qualify

Renovations must be to your principal residence, which must be located in Saskatchewan.
Renovation expenses must be incurred between October 1, 2020, and December 31, 2022.
The renovation must be substantially completed by December 31, 2022.
At the time of the renovation(s), you must own, alone or jointly with another person, the housing unit (or share of the capital stock of a co-operative housing corporation that you acquired solely for the right to inhabit the housing unit owned by that corporation).
You, your current or former spouse or common-law partner, or any of your or your spouse/common-law partner's children must ordinarily inhabit the housing unit during the eligibility period.
In general, renovations must be of an enduring nature and integral to the dwelling or to the land that forms part of the dwelling. Land of one-half hectare or 1.24 acres, including the land upon which your housing unit stands and any portion of the adjoining land, will generally be considered part of your eligible dwelling for purposes of this tax credit.

2. Claim Credit on Tax Returns

Claim the credit on your 2021 and/or 2022 personal income tax returns:

Total qualified expenses incurred between October 1, 2020, and December 31, 2021, in excess of $1,000 (base amount), but not more than $12,000 can be claimed on your 2021 tax return (maximum claim of $11,000 for 2021).
Total qualified expenses incurred between January 1, 2022, and December 31, 2022, in excess of $1,000 (base amount), but not more than $10,000, can be claimed on your 2022 tax return (maximum claim of $9,000 for 2022).
The tax credit can be split among eligible family members, but the total amount claimed cannot exceed the maximum allowable. Eligible family members include you and your spouse or common-law partner and you or your spouse/common-law partner's children who are under 18 years of age at the end of 2021.
If you sell and purchase an eligible dwelling during the eligibility period, qualified expenses that you incur for both dwellings will be eligible (however, each dwelling must have been your permanent residence at the time the renovations occurred). The maximum total of qualified expenditures that you can claim is $20,000.
If you earn rental or business income from part of your eligible dwelling, you can only claim the amount for expenses incurred for the personal-use areas of your dwelling. For expenses incurred for common areas or that benefit the housing unit as a whole (e.g., re-shingling a roof), divide the expense between personal use and income-earning use and claim the personal-use portion.
Example of splitting the tax credit between family members: You and your spouse enter a contract for the purchase and installation of a new furnace after October 1, 2020, and pay $9,500 for this renovation. On your 2021 tax return, calculate the tax credit as follows: Total qualified expense of $9,500, less the $1,000 base amount = $8,500. Either you or your spouse can claim the entire $8,500 or you can each claim a portion of it. For example, if you claim $3,500, your spouse can claim the remaining $5,000.

3. Documentation

Eligible expenses must be supported by documents such as receipts or invoices and should clearly identify:

the vendor/contractor including business address and (if applicable) their GST/HST registration number
the type and quantity of goods purchased and/or services provided
the dates when the goods and/or services were purchased or delivered

Invoices must by marked "paid" or be accompanied by other proof of payment such as credit card slips or cancelled cheques.

4. Eligible Expenses

Examples of eligible expenses:

painting the interior or exterior of a house
re-shingling a roof
kitchen, bathroom, and/or basement renovations
flooring (carpet, linoleum, hardwood, laminate, etc.)
windows and/or doors
furnace, boiler, woodstove, fireplace, water softener, water heater, and/or oil tank
central air conditioner
permanent home ventilation
permanent reverse osmosis system
septic system and/or wells
electrical wiring upgrades (e.g., changing from 100 to 200 amps)
home security system (monthly fees do not qualify)
solar panels and panel trackers
standby generators, automatic garage door openers, and electric vehicle charging units – provided these items are permanently affixed to your home or garage (if the unit is portable and can be moved between homes, garages or other structures it does not qualify)
building a garage, deck, fence, garden/storage shed, gazebo, and/or an addition to your home
building a new driveway and/or retaining wall (or resurfacing a driveway)
exterior shutters and awnings
underground sprinklers
pool liners and/or solar heaters and heat pumps for pools (does not include solar blankets)
landscaping (e.g., sod, perennial shrubs and flowers, trees, tree and stump removal, large rocks, crushed rock, permanent garden lighting, permanent water fountain, permanent ponds, large permanent garden ornaments)
fixtures (e.g., blinds, shades, shutters, lights, ceiling fans)
electronic devices that are installed as a fixture and are necessary and primarily used to operate another eligible expenditure (e.g., a device that is a fixture and is necessary and primarily used to operate solar panels, air conditioning systems, home security devices, or ventilation systems)
asbestos removal from house or garage
associated costs to the above such as installation, permits, professional services, equipment rentals, the amount of GST/PST paid, and incidental expenses (e.g., work performed by electricians, plumbers, carpenters, architects, etc. will generally constitute an eligible expense)
for condo owners and co-operative housing corporation members, your share of the cost of eligible renovations to common areas will qualify for the tax credit if certain conditions are met (see Information Bulletin for more details)

5. Ineligible Expenses
Examples of expenses which are not eligible:
- renovations to a cottage or cabin unless it is your principal residence
- the value of your own labour for do-it-yourself projects
- payments to a close relative or other person not at arm's length, unless that person is registered for GST purposes
- routine repairs and maintenance typically performed on an annual or more frequent basis
- maintenance contracts (e.g., furnace and/or pool cleaning, snow removal, lawn care, etc.)
- appliances, furniture, draperies, hot tubs, and mechanical items not considered an enduring addition to your home (e.g. fridges, stoves, couches, etc.)
- TVs, computers, tablets, smart devices, speakers, streaming devices, cellphones, gaming systems, and other audiovisual electronics
- items that have a value independent of the renovation, such as construction equipment and/or tools
- any financing costs (e.g., interest payments) associated with the renovation(s)