If you own a home in Ontario or Toronto, you may be eligible for the Underused Housing Tax (UHT) rebate. This rebate is designed to encourage homeowners to convert their underused space into rental units, which can help to ease the housing shortage in these areas. In this blog post, we will explore everything you need to know about the UHT, including how to apply and the eligibility requirements.

What is the Underused Housing Tax?

The Underused Housing Tax is a rebate program that was introduced in Ontario in 2019 as part of the Housing Supply Action Plan. The program provides rebates of up to $50,000 to homeowners who create new rental units in their homes or convert existing underused space into rental units. The rebate is intended to offset the costs associated with creating rental units, such as building permits, construction costs, and legal fees.

Eligibility Requirements

To be eligible for the Underused Housing Tax rebate, you must meet the following criteria:

  1. You must be the owner of the property where the new rental unit will be created or the underused space will be converted.
  2. The property must be located in Ontario, and the new rental unit must be located in Toronto or the Greater Golden Horseshoe Area.
  3. The unit must meet all applicable zoning, fire, and building code requirements.
  4. The unit must be rented out for at least one year after it is created or converted.
  5. You must not have received any other government funding or incentives for the creation of the rental unit.

How to Apply

To apply for the Underused Housing Tax rebate, you must complete the following steps:

  1. Determine whether you are eligible for the rebate based on the eligibility requirements outlined above.
  2. Submit an application to the Canada Revenue Agency (CRA). The application form can be found on the CRA website and must be completed and submitted within 24 months of the date the rental unit is first occupied.
  3. Provide supporting documentation, including building permits, construction invoices, and other relevant documents.
  4. The CRA will review your application and determine whether you are eligible for the rebate. If you are eligible, the rebate will be paid to you within a few weeks of the application being approved.

Conclusion

The Underused Housing Tax rebate is an excellent opportunity for homeowners in Ontario and Toronto to create new rental units or convert underused space into rental units. The rebate can help to offset the costs associated with creating rental units and can provide a much-needed boost to the rental market in these areas. If you are a homeowner in Ontario or Toronto and are interested in creating a new rental unit or converting underused space, be sure to explore your eligibility for the UHT rebate.