House construction Loophole?

[UrbanCityDreams]

Say i started a construction company for building a custom home for myself. Could i not divert all my building expenses materials and labour including new truck etc to this company and save all this money on taxes and the finished total cost of the house?

do people on here even own houses?

[NSgirl]

quote:Originally posted by UrbanCityDreams

Say i started a construction company for building a custom home for myself. Could i not divert all my building expenses materials and labour including new truck etc to this company and save all this money on taxes and the finished total cost of the house?

do people on here even own houses?

Yes some of us own our own house,mortgage free too,thankyou!

I do not think the tax department is that stupid,for you to just start a business to write off your expenses.
You would need to have the house for sale, first I would think and also show some king of an income from construction,to be able to claim write offs.

You could however have a homebased business and write off the part of the house you work out of,but again you will get dinged tax on the part you used to claim when you sell the house.

[UrbanCityDreams]

hmm..just trying to avoid the tax man and i know they aren't stupid, i just want to be smarter[]

maybe i could build the house and say it is going to be head office so the whole property is written off and then move to a new head office as i build another. well i may as well call myself a developer then.

having your house paid off is enviable and i'm proud of you NSgirl.

interest is huge on a mortgage. in the states you can write that interest off and i think Canada should let you as well becuase it's the interest that is a huge neverending expense it seems.

[NSgirl]

If I was you and you really want to do someting like this, I would pay a few bucks and hire a tax accountant and ask what you can get away with and how to do it! the last thing you want to do is expect a huge tax write off and get dinged, and audited in the process!
Hope you find your loop hole I am sure there is a small one out there somewhere!

[M Grenade]

what taxes would you be saving? You should check with an accountant, but I think all you would be doing is getting deductions for a company that has no actual revenue other than yourself, so you aren't saving anything that way.

gst is a heavily audited program, if you are trying to get around that with some kind of paperwork then I think you will have to be ready to explain everything... again, where is the saving, if your company does work for yourself, you have to charge yourself gst on any work, so I don't understand where this plan could save you anything?

If you are creating a company with the sole purpose of trying to show a loss to deduct from other income, I think you have to show that it is a business with a legitimate goal to make a profit or they will disallow... again I would check with an accountant but I have a feeling this won't work very well