I have senior clients with 2 rental properties. They received school tax rebates on each of these. How should I report these? As additional income on T776, reducing the Taxes paid on the T776, or ignore?
At present I am reducing the property taxes on T776 by the amount of the rebate
Thanks for suggestions or ideas
They should not have received them for their rental properties.
They’ll need to pay it back eventually. Count it as an overpayment that is to be repaid (i.e. don’t claim it)
The tenants will be attempting to claim the amount via their tax return and eventually CRA will connect the dots and figure out that the owners were not entitled to it, and notify the province who will be asking for it back.
I had that happen to one of my own rentals, despite me telling the property tax office that I wasn’t entitled to it. Only took them three years to correct it but they eventually did. Same will happen to your clients.
Thank you for your insight. Makes total sense and I will advise them to set aside the $$