Tax Deductible Loan For Real Estate Investment

by Mike
(Acton)

In Canada, does a non-principle residence property need to be rented out in order to qualify as an investment such that the interest on a loan to purchase the property is elidgable for tax deduction? (ie. a summer home, or cottage, whereby the expected return on investment is the appreciation, not the rental income)

Thanks,
Mike S

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Apr 19, 2012
RE: Tax Deductible Loan
by: Tom Karadza

Hi Mike, thanks for the question!! The CRA rules around this seem to constantly change. From our experience you do have to show the intent to “profit” from the property before you’re able to deduct expenses. Your best option would to speak to a good accountant on this.

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