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New Member
posted Jan 8, 2020 4:03:41 PM

How do I add renovation (new garage) costs to rental income? Does it classify as maintenance?

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1 Replies
Level 15
Jan 22, 2020 8:25:39 PM

No, a new garage added to your rental property is not classified as maintenance and cannot be claimed as a current expense.

 

When you do construction or major renovations to a capital property that improves that property, you can deduct the cost over a period of several years. This deduction is called capital cost allowance (CCA), commonly called depreciation

 

These following links explain the difference between current and capital expenses and explain how to enter both types of expenses on your tax return.

  • How do I enter my rental income and expenses in TurboTax?  

    https://turbotax.community.intuit.ca/community/other-income/help/how-do-i-enter-my-rental-income-and-expenses-in-turbotax/00/873580

  • CRA Current or Capital Expenses: 

    https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/rental-income/current-expenses-capital-expenses.html

  • CRA Capital Cost Allowance for Rental Property: 

    https://www.canada.ca/en/revenue-agency/services/tax/businesses/topics/rental-income/capital-cost-allowance-rental-property.html