Q & A on the BC First Time Home Buyers Bonus – Part 2

A few weeks ago we blogged about the great new BC First Time Home Buyers Bonus.  That was only a portion of the pertinent information available regarding the bonus.  Today I would like to give you the rest of the most important information!
As always, at any time please contact us for further and more in-depth answers!
Part 2 – Claiming the Bonus
20. How do I claim the bonus?
Individuals must apply for the bonus through the Ministry of Finance. Information on the application process and the application form is available at the following link:
https://www2.gov.bc.ca/gov/content/taxes/audit-ruling-appeal/appeal/minister/can-you-appeal/first-time-new-home-buyers-bonus
21. Is it true that the bonus will reduce my taxes payable and I will only receive a portion of the bonus depending on my income tax bracket?
The bonus is not claimed on your income tax return. The bonus will not reduce the amount of taxes payable on filing your personal income tax return. The bonus will be issued by the BC Ministry of Finance. You may be entitled to receive up to $10,000 but the amount of the refund is reduced if your family net income exceeds $150,000.
22. What if the Canada Revenue Agency (CRA) reassesses my income tax return after I apply for the bonus?
You must notify us of any changes to your income tax return (e.g. changes to your net income as reported on line 236 of your return) that could impact your eligibility for the bonus.
23. Where do I get the form to apply for the bonus?
The draft application form and the guide are available at: https://www2.gov.bc.ca/gov/content/taxes/audit-ruling-appeal/appeal/minister/can-you-appeal/first-time-new-home-buyers-bonus
24. What documentation will I need to provide to claim the bonus?
The documentation the BC government will request as part of your application for the bonus is still being finalized. It is advised that you retain all legal documents relating to the purchase of your home, including the written agreement of purchase and sale, copies of federal form GST190 GST/HST New Housing Rebate Application for Houses Purchased from a Builder or form GST191 GST/HST New Housing Rebate Application for Owner-Built Houses and documentation showing when you took ownership and possession of your home. Please check back later in the year for more information.
For owner-built homes, you must keep receipts for all construction costs.
25. Is there a penalty for false statements or omissions?
Penalties may be imposed if you make a false statement or omit information on your Application for the BC First-Time New Home Buyers’ Bonus or any of the supporting documentation. The penalty imposed will be equal to the excess of the amount of the bonus received. You would be required to repay both the excess of the amount of the bonus received and the penalty imposed.
26. I moved to BC on January 20, 2012. I purchased an eligible home on May 26, 2012. When will I receive my bonus payment?
If you move to BC after December 31, 2011, and before January 1, 2013, you must submit a copy of your 2012 Notice of Assessment from the Canada Revenue Agency, which is issued after you file your 2012 personal income tax return in 2013. You may submit the application and other supporting material in advance; however your refund cannot be issued until a copy of the 2012 Notice of Assessment is received.
27. Is it true that if I receive a $10,000 bonus cheque, I have to use the money to pay down my mortgage?
No. An individual who receives the bonus is not required to use it to pay down their mortgage.
28. My brother and I purchased an eligible new home. He claimed the BC HST New Housing Rebate and completed and submitted the application form for the BC First-Time New Home Buyers’ Bonus. We would like the amount of the bonus to be divided in half and to receive two cheques, one made out to each of us. Is this possible?
No, the cheque cannot be split between purchasers. The bonus cheque will be made out to the individual who completes the application, and only one individual can complete the application. This individual is the same individual who claims the BC HST New Housing Rebate.
29. Has the BC First-Time New Home Buyers’ Bonus legislation been drafted and is it available for the public to view?
The legislation to enact the BC First-Time New Home Buyers’ Bonus is expected in Spring of 2012. A link to the legislation will be included here as soon as it is available.
Additional Information
30. Who do I contact if I have additional questions?
http://www.sbr.gov.bc.ca/individuals/income_taxes/personal_income_tax/tax_credits/fthb_bonus_faqs.htm