Had a client who took out $35000 for HBP in 2020. When i did AFR for her 2022 tax year AFR picked up on the 35000 but reported 0 for the repayment required yet when logged into RAC and viewing her HBP statement, it shows that a required repayment of 2333.33 is required for 2022 as it should.
Anyone else have this quirk?
Yes, I’ve seen that for only one client so far this year, last week or the week before last.
RAC was accurate. AFR showed $0.00. And like with your client, the HBC was initiated in 2020, so 2022 would be the first year of repayment. I used the RAC values in filing this client’s return.
I’ve had a few clients with the exact situation with HBP. AFR info seems incomplete. I trust Rep a Client in these situations. I’ve reached out to TaxCycle and if I understood correctly, it’s a CRA side issue and not TaxCycle.
Not seen this problem, but I have one that is kind of the opposite:
Trying to catch up a client who hadn’t filed 2020 and 2021 T1s, and per CRA there is a required HBP repayment from a HBP withdrawal in 2017. When I mentioned this to the client, he was shocked, because he had NOT taken a HBP withdrawal in 2017
He had withdrawn and closed out an RRSP account that year, so I had him contact the RRSP company to confirm they hadn’t accidentally filed the HBP by mistake - they hadn’t. Then I told him to contact CRA to track down where/how this happened. The first-level CRA agent told him (after investigating a bit) that CRA made the mistake! But, the agent had no idea how to fix it himself, and supposedly submitted an internal request to have a more senior agent deal with it.
Three months later, it still hasn’t been corrected, and CRA’s EFIlLE system won’t allow the T1s to be filed unless we include the HBP repayment, which the client refuses to accept…
I would want to see the 2017 T1 return if the client still has a copy of it (or look online in Rep a Client) to confirm he reported RRSP income on line 129… and that amount agrees with the HBP balance in AFR. Of course if the client didn’t purchase a home in 2017 or 2018 then he obviously couldn’t have made a HBP withdrawal.
If you really need to get the T1’s filed, and you are certain the CRA is wrong declare the HBP as income on line 12900 and take an offsetting deduction on line 23200.
If you file the T1 returns and don’t include the HBP repayment amount the CRA are looking for their system will simply add it to his income on initial assessment.
You can’t even get that far. I have tried to e-file the returns. TaxCycle just gets an error message from CRA - their system WILL NOT ACCEPT the filing without the HBP income inclusion.
Yes, of course. That’s the first thing I did. The 2017 assessment on RAC shows the RRSP income, and the client verified that amount as the full amount he withdrew that year. And he didn’t buy a house in 2017, so there shouldn’t have been a HBP withdrawal.