There is hardly any other investment that is more beneficial in terms of high capital appreciation, high income stream and tax advantages than investing in the real estate market. It brings not only financial benefits to the real estate investors, but it may also generate substantial tax savings that includes tax sheltering as well.
Owning property in Canada can be highly profitable if you understand the Canadian tax laws which are associated with real estate investments. Canadian laws are quite liberal when it comes to owning real estate. There is no residency or citizenship requirement for buying and owning property in Canada. Non-residents can also own rental property in Canada, but they need to file annual tax returns with the CRA.
Property taxes, line of credit interest and repairs & improvements can be considered as tax deductibles in Canada as long as the property remains an investment property. As an investor in real estate business, you need to be aware of the tax implications at every stage of the investment i.e.: from owning the property, to renting it, and to eventually selling it.
Investing your money in real estate can have many challenges and you must be prepared to ensure that your money is well invested. For real estate accounting services, you want the right professionals who must be able to categorize expenses appropriately and can deliver real estate accounting & tax knowledge efficiently and effectively.
Your real estate accountant should be an industry specialist as he will be protecting your business interest and enabling you to make smart real estate investments.
If you are already working with a real estate accountant or looking to engage with a new one, we would suggest considering the below questions to see if they’re the right fit for your business or not.
- How many real estate investments do you have in Canada?
- How long have you been investing in real estate business?
- Do you provide your accounting and tax advisory services for either active investments, passive investments or both?
- What kind of real estate holdings do you and your clients have?
- What percentage of your accounting & tax practice is devoted to real estate matters?
GTA Accounting offers a number of tax services for real estate investors, developers, builders and contractors. Apart from preparing tax returns and financial statements, we can also analyze key financial ratios and prepare you for any loan application.
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