Is constructing a laneway home on your mind?
At JLT CPA we focus primarily on real estate tax issues and today I’d like to talk to you about something to consider before you build. If you are thinking of constructing a laneway home be aware that some tax issues may arise from that particular activity.
People build laneway homes for different reasons. You should know that your reasons for building a laneway will determine whether you encounter tax issues.
So first off, did you know you may be considered a Builder depending on your reason for constructing a laneway home?
If you’re building this laneway home where the ultimate use of it is going to be for renting it out to somebody else or if you are going to sell the laneway home as a stratified property, you are a Builder and may have income tax issues and GST issues.
For now, know that your simple, compact laneway home brings all kinds of potential tax issues with it. You may be affected at the income tax level and you are also creating GST issues. So, before putting that shovel in the ground, do feel free to reach out and shoot me an email or give me a call.
I’d be happy to have a quick chat with you about it and we can dig up the details you need together, in a personal call to clarify your situation.
I’ll be posting more on what defines a builder and how your reasons for constructing a laneway home will impact you tax wise as well as what kind of taxes may apply to your situation.
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