Can I Claim House Renovations on My Taxes in Canada? (2026 Guide)

Can you claim home renovations on Canadian taxes? Yes, in specific situations. Here are the credits, rebates and deductions that actually exist in 2026.

Published April 1, 2026 · Updated May 2, 2026

This is the question I get every spring during tax season. A client finishes a basement or renovates a kitchen, then asks if any of it is deductible. The honest answer is: sometimes yes, often no, and the rules depend on what kind of renovation it was and what the property is used for.

Here is the realistic 2026 breakdown of what you can and cannot claim.

The Short Version

Personal-use renovations on your principal residence are generally not deductible. There are specific federal and provincial credits for certain types of work (multigenerational suites, accessibility, energy upgrades), and renovations on rental or business properties are deductible against rental or business income. That is the whole map.

Now the details.

What You Can Claim on Your Personal Residence

1. Multigenerational Home Renovation Tax Credit (MHRTC)

This is the big one introduced in 2023. If you renovate to create a self-contained secondary suite for a senior parent or an adult relative who qualifies for the disability tax credit, you can claim 15 percent on up to $50,000 in eligible expenses. Maximum credit: $7,500.

The catch: the suite has to be self-contained (its own kitchen, bathroom, bedroom, entrance) and a qualifying relative has to actually move in. Finishing your basement so the kids have a playroom does not qualify.

I wrote a detailed $7,500 home renovation tax credit guide covering who qualifies and how to claim.

2. Home Accessibility Tax Credit (HATC)

This is the underused one. If a senior 65 or older or a person eligible for the disability tax credit lives in the home, you can claim 15 percent on up to $20,000 in eligible expenses for accessibility renovations. Maximum credit: $3,000.

What counts:

Walk-in tubs and curbless showers
Wheelchair ramps and lifts
Wider doorways
Lever-style door handles and faucets
Non-slip flooring
Grab bars and reinforced bathroom walls
Lowered counters

You can stack HATC with MHRTC on the same project as long as you do not double-count the same expense for both credits. So a basement secondary suite for an aging parent that includes a curbless shower and grab bars could potentially qualify for both.

3. Provincial Energy Rebates

Federal grants like the Canada Greener Homes program have changed shape over the years, but Ontario typically still has utility-driven rebates for:

Heat pump installation
Insulation upgrades
Triple-pane windows
Smart thermostats

These are usually rebates (cash back) rather than tax credits. They change frequently. Check Enbridge’s energy efficiency rebates and the federal Greener Homes pages each year before you start the project.

4. GST/HST New Housing Rebate (Substantial Renovation)

If your renovation qualifies as a “substantial renovation” under CRA rules, you may be eligible for a partial GST/HST rebate similar to what new home buyers get. The bar is high. Substantial renovation generally means 90 percent or more of the interior of the home was removed or replaced.

A normal kitchen or bathroom remodel does not qualify. A full gut where you tear back to the studs and replace mechanicals, drywall, finishes throughout could. Talk to an accountant before the project starts if you think yours might qualify, because the documentation needs to be in order from day one.

What You Can Claim on a Rental Property

Now the rules flip.

If the property is a rental, renovation costs are either current expenses (deductible against rental income in the year incurred) or capital expenses (added to the property’s adjusted cost base and depreciated over time).

The line between current and capital is roughly:

Current expense: maintenance, repair, restoring something to its original condition. Patching drywall, repainting, replacing a worn toilet with a similar one. Fully deductible against rental income that year.
Capital expense: improvement, betterment, longer useful life, or new functionality. New kitchen, new bathroom, addition, new windows, new HVAC system. Added to the property’s cost base and depreciated under capital cost allowance (CCA) rules.

Both reduce your tax bill, but in different ways. Current expenses come off your taxable rental income immediately. Capital expenses reduce future capital gains when you eventually sell, and you can claim CCA depreciation each year.

If you are renting out part of your principal residence (a basement apartment, for example), you can claim a proportionate share of the renovation costs against the rental income from that unit.

What You Can Claim on a Home-Based Business Space

If you have a home office or run a business out of part of your home, you can claim a proportionate share of renovation costs related to that business space. The proportion is usually based on the square footage of the business area divided by the total home area.

A renovation of the dedicated office space (paint, flooring, electrical for office equipment) is more directly deductible than a renovation of a shared space (kitchen used for both family and business).

CRA wants the business use to be exclusive or near-exclusive for the deduction to be fully clean. A spare bedroom that doubles as an office and a guest room is a grey area. A dedicated office that is only used for the business is straightforward.

What You Cannot Claim

This is most of what people ask about. None of these are deductible on a personal-use principal residence:

New kitchen because the old one was dated
New bathroom because the old one was 1980s
Basement finishing for personal use (rec room, kids’ playroom, home theatre)
Hardwood floor refinish
Repaint of the whole house
New windows for aesthetic reasons (energy upgrades may have separate rebates)
New roof
Driveway, landscaping, deck
Pool installation
Garage door replacement

These add to your home’s value but are not tax-deductible. They do, however, increase your adjusted cost base, which matters if you ever sell the property as a non-principal residence (vacation home, rental conversion).

What to Track Anyway

Even if your renovation is not currently deductible, keep every invoice for at least six years. Two reasons:

1. Capital gains adjustment if the property use changes. If you ever rent the home out, sell a portion of it, or convert it to a non-principal residence, your renovation costs reduce your taxable capital gain.

2. Resale clarity. Many buyers ask for documentation of major work done. Having a clean file makes the sale process smoother and can support a higher asking price.

We send every client a project summary at handover with all line items broken out, even when they are not claiming a credit. Cheap insurance.

Common Tax Time Mistakes

A few things I see homeowners get wrong:

Trying to claim a personal renovation as a business expense. CRA notices when “professional services” line items appear on personal returns without supporting documentation. Do not.

Forgetting to claim eligible credits. If you qualify for MHRTC or HATC, claim them. Do not assume your accountant will catch it. Tell them before the return is filed.

Mixing rental and personal expenses. If you rent a basement apartment, you need to track which expenses are for the rental and which are for the rest of the house. A blanket “renovation” line item gets denied.

Underestimating substantial renovation rules. The bar for the GST/HST new housing rebate on substantial renovation is high. Most kitchen and bathroom projects do not qualify. Confirm with an accountant before relying on it.

When to Bring in an Accountant

Always, if you are:

Claiming MHRTC, HATC, or any other federal or provincial credit
Renovating a rental property
Renovating part of a property where you also run a business
Doing a substantial renovation and considering the GST/HST rebate
Selling soon after the renovation

A good accountant will save you more in correctly-claimed credits than they cost. They also handle the audit defence if CRA asks questions later.

If you are planning a renovation that might qualify for a credit, contact us for a free estimate. We build itemized quotes that make tax-time documentation simpler and we have done plenty of basement secondary suite projects for the multigenerational credit.