Reporting Rental Income
You might have asked whether you need to report all of your rental income.
The answer is yes, all rental income is taxable and should be reported when filing taxes. However, there are some expenses that can be deducted for tax purposes.
Capital versus Current Expenses
Both capital and current expenses incurred through your rental property can be deducted for tax purposes.
Capital expenses refer to those that generate a lasting benefit or advantage. This could include renovation expenses that extend the useful life of the rental property. On the other hand, current expenses are costs that generally reoccur after a short period. For example, the cost of painting the exterior of a wooden property would be considered a current expense.
✋🏻 What are some examples of rental expenses that I can deduct when filing my taxes?
Advertising
Insurance
Interest and bank charges
Professional fees
Property taxes
Repairs and maintenance
Management and administrative fees
✋🏻 How do I report my rental income?
If you received rental income, you must complete the T776 - Statement of Real Estate Rentals and report the income received in the calendar year. This form will include details of the rental property, ownership, expenses, CCA, and so on.
For additional information, please visit the CRA website here.
(*) This article is intended as general information only and is not to be relied upon as constituting legal, financial, or other professional advice. A professional advisor should be consulted regarding your specific situation.
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