A new construction program in Canada will save you $5,000 CAD
Announced a 100% tax rebate to encourage housing construction.
The Residential Unit Development Incentive (RUDI) program on Prince Edward Island provides financial support for the development of newly constructed rental homes. Through this initiative, eligible developers will receive rebates for 5 years on provincial property taxes in the amount of:
- 100% in 1 year;
- 80% in Year 2;
- 60% in Year 3;
- 40% in Year 4;
- 20% in Year 5;
The provincial property tax rate for commercial and non-commercial properties in the province is set at $1.50 CAD for every $100 CAD of taxable value. Under the provincial tax credit program, island residents may qualify for a provincial tax credit of $0.50 CAD per $100 CAD of the taxable assessed value of any non-profit property they own.
Here's an example: let's take the average home value in the province, which is about $300,000 CAD. You are an island resident and have a non-profit property in Charlottetown, where the non-profit municipal tax rate is $0.67 CAD per $100 CAD of assessed property value. Based on all calculations, the annual tax would be about $5,500 CAD, which is a pretty hefty amount.
"Inflationary pressures and supply chain issues have made it difficult for developers to effectively build housing units throughout Prince Edward Island. Private developers provide a critical service to our island's housing market and are valuable partners in addressing the housing supply throughout Prince Edward Island. As a province, we know that we must provide the support and encourage building even in difficult times," - Minister of Finance Mark McLane.
Applicants may apply for and receive conditional approval before obtaining their development and/or construction permits, but applications must be received before work begins.
In order to receive the rebate, approved applicants must pay their property tax bills and file a request for a refund of the provincial portion of their property taxes paid.
