In Canada, is my mortgage interest tax deductible? | Loans Quebec

Image result for mortgage canadaFederal and provincial taxes play an important role in the functioning of our economy. They help build government programs, fund health care, education, and maintain our cities, towns, and villages. Over the years as a Canadian taxpayer, you will find a variety of ways to save money here and there during the tax period. You will learn which expenses are tax deductible, how you can reduce your taxable income, and other benefits while advancing in life and contributing to our country.

One of the questions we are often asked is whether in Canada the interest on your mortgage is tax deductible. Our American neighbors are lucky and can declare their mortgage interest as tax deductions. So, is this the case in Canada? To give a simple explanation, our tax system does not work that way. But the good news is that if you decide to sell your principal home and make a profit, you will not have to pay tax on that money. While in Canada you will not be able to claim interest on your mortgage, you will benefit from the system when selling your home, tax free.

Why are mortgage interests not tax deductible in Canada?

Image result for Why are mortgage interests not tax deductible in Canada? In 2009, a case was heard in the Supreme Court of Canada, where two homeowners deducted more than $ 100,000 in interest on their mortgage between 1994 and 1996. Unfortunately, after review, the Minister of National Revenue cited the deductions as “abusive tax avoidance” and declared them invalid. After the owners brought lawsuits, the Supreme Court sided with the Canadian government, officially proclaiming that no tax deduction could be made on mortgage interest payments, unless the house does not generate income when it is rented.

What if you use your home to run a small business?

If you work from home, or use it to run a small business, you can deduct certain costs associated with your workspace. This may even include home-related expenses, such as electricity, but you can not under any circumstances deduct the interest on your mortgage.

For example, if a homeowner sets up a home office, equipped with a computer, a fax machine and a printer, because of the extra power the appliances create, the electricity bill will increase. The owner might even need office supplies, maybe even pay employees to help him with his workload. They can contact the Canada Revenue Agency and find out if their home qualifies as a business and what expenses, if any, can be claimed. If the home is eligible, the landlord may report things such as the supply, property taxes (or property costs) and other related costs related to taxes, and be entitled to a deduction for amounts spent during the tax year.

What if your house produces rental income?

As mentioned above, one of the only ways to get a tax deduction on your mortgage interest would be to use your home or condominium for rental purposes. In other words, you should turn your house into an investment property. For example, if you rent one or more of your rooms, or if you need to renovate a portion to make a living suite in the basement and earn income through a tenant, your expenses will be as well. related to the rental. You can then claim the taxes. However, if your property or condo does not generate any income from a business or lease, you will not be entitled to any tax deductions.

What happens after the sale of your house?

First of all, be aware that working from home or converting your principal residence into an investment property has certain tax advantages. Selling your house after generating income with it has a persistent disadvantage. If and when you decide to sell your house, you will have to pay taxes on the profits of your investment property. This is called “the capital gains tax, in which you will pay taxes on about half of the profits that your property (your house) has earned since it started producing you a returned.

However, if you decide not to convert your principal residence into an investment property, the income generated by the sale of your home will be tax-sheltered. In other words, if you bought a house 10 years ago for $ 350,000 and sell it today for $ 500,000, the additional $ 150,000 earned will not be taxable. Keep in mind that since 2016, the Canada Revenue Agency has clarified that homeowners and condominium owners must now report profits from the sale of their homes under schedule 3 of their rebate even if you sell your principal residence and are exempt from capital gains tax.

Should I try to make the taxes on my mortgage interest deductible?

 Should I try to make the taxes on my mortgage interest deductible?

In conclusion, mortgage interest payments are not tax deductible except in special circumstances, such as renting your property to earn income. In addition, home-based businesses that do not involve rental of any kind will not benefit from tax deductions on mortgage interest. So if you’re thinking of turning your home into a small business or investment property, and want to save some tax dollars, do not forget to consider all the factors and know what you’re getting into.

Extension of the term of the First Call POCTEP 2014-2020 until 01/22/2016

Image result for INTERREG VAThe Follow-up Committee of the INTERREG VA Spain-Portugal Cooperation Program (POCTEP) 2014-2020 has approved the extension of the deadline for submitting applications for the First Call for projects until January 22, 2016, the deadline for which is the registration and sending of candidacies in COOPERA 2020 at 2:00 pm (Spanish peninsular time).


Approved by the European Commission (EC), in its Decision C (2015) 893, on February 12, 2015, the INTERREG VA Spain – Portugal Program (POCTEP) 2014-2020 is the direct consequence of the favorable experience that since 1989 has Of course cooperation on the border between the two countries has allowed and that it intends to continue making progress in improving the quality of life of the inhabitants of the Cooperation Area.

The POCTEP 2014-2020 acts in five major areas or thematic objectives:

  • Promote research, technological development and innovation
  • Improve the competitiveness of small and medium enterprises.
  • Promote adaptation to climate change in all sectors.
  • Protect the environment and promote the efficiency of resources.
  • Improvement of institutional capacity and efficiency of public administration.

The POCTEP contemplates actions in favor of research, development and innovation, such as:

  • Research and innovation activities, including the creation of networks.
  • Technology transfer and university-business cooperation, especially for the benefit of SMEs.
  • Processes of research and innovation in SMEs.

It also includes actions related to business development and the promotion of quality employment:

  • Promotion of entrepreneurship and entrepreneurship in SMEs.
  • Business development of SMEs, support of networks of tutors and support for entrepreneurship and incubation.
  • Self-employment, entrepreneurial spirit and creation of companies, including microenterprises and entrepreneurial SMEs.
  • Promotion of internationalization.
  • Mobility of workers, companies and entrepreneurs.

Likewise, in terms of the environment and energy and ecological infrastructures, the POCTEP foresees measures of:

  • Adaptation to climate change and prevention and risk management.
  • Development and promotion of the tourism potential of natural spaces.
  • Protection and promotion of the assets of culture and natural heritage.
  • Treatment of household waste.
  • Management and conservation of drinking water.
  • Integrated pollution prevention and control.

Finally, the Program provides for other types of actions related to improving the institutional capacity of public administrations and services through cross-border cooperation.

What is the term for the payment of life insurance?

Image result for life insurance

What is the term for the payment of life insurance? Can I receive interest if the payment is delayed?

Every year there are more than 30,000 families who, thanks to Life Insurance, can economically rebuild their lives, which, according to the latest data from the Social Insurance Report, is based on an average insured capital of 23,920 euros.

But if the amount of coverage is important, so is the insurance premium. Many people use this amount to pay for urgent expenses and the majority to be able to adapt to a change in family circumstances that almost always involves a cut in income, but keeps a good part of the expenses.

A collection process that protects the insured

Image result for protectionThe collection procedure seeks to make it fast and agile. The facilities begin with the payment of taxes, allowing the partial settlement of Inheritance Tax only for the amount of the insurance and with the added advantage in some products, such as life insurance of AEGON , which even advance the amount of the Tax to be able to pay it. and request payment.

Liquidated the Tax, you can request the payment of the amount. As stipulated in article 18 of the Insurance Contract Law : “The insurer is obliged to pay the indemnity at the end of the investigations and appraisals necessary to establish the existence of the loss and, where appropriate, the amount of damages that result of the same “to which it adds that:” In any case, the insurer must make, within forty days , from the receipt of the declaration of loss, the payment of the minimum amount of what the insurer may owe, according to the circumstances known to him. ” All this, as also states Article 19 : “except in the event that the loss was caused by bad faith of the insured.”

Payment of interest if there is a delay in payment

But what happens if these 40 days pass and the insurance payment is not received? Article 20 of the Insurance Contract Law stipulates a series of rules that protect the insured in case of delay in the payment of compensation.

In the first one, it indicates who may claim the insurance company, in the case of life insurance, it clearly defines it as: “It will affect, in general, the default of the insurer with respect to the policyholder or insured person and, in particular, , to the delay with respect to the third party injured in the civil liability insurance and the beneficiary in the life insurance “.

After paying the Inheritance Tax and requesting the payment of the insurance, the figure of the beneficiary of the life insurance is more than clear and it will be only this one who can claim from the insurance company the payment of any type of compensation for the delay in the payment .

This delay occurs when: “he has not fulfilled his benefit within three months from the production of the loss or has not proceeded to pay the minimum amount of what may be due within forty days from the receipt of the declaration of the sinister “.

From this period is when you can penalize the delay of payment and would do so as long as there is no justifiable cause by the insurance company:

  • With the payment of an annual interest equal to the legal interest of the money in force at the time it is accrued, increased by 50%. Currently the legal interest is 3%, increased by 50% would require the payment of 4.5% per year, calculated by the days of delay. It is important to highlight a point of this article 20, which is not necessary to make “judicial claim” to request the payment of this interest.
  • To accelerate the collection, the regulation also establishes a high interest, clearly with a penalizing objective, if two years have elapsed since the request for payment, thus it determines that: “after two years from the production of the claim, the annual interest can not be less than 20% “

Although the delays of payment in any sense, without there being a justified circumstance, are very rare. What is clear is that the insured is protected by a regulation that, if not even improved by the insurance contract, establishes a fast collection period and penalizes with high compensation any delay.