How Landscaping Can Be a Capital Improvement
When performing landscaping either yourself or through a professional company, occasionally some of your costs may be deductible. Landscaping isn’t clearly defined in the tax laws, but Interpretation Bulletin IT-296 suggests that most costs will be considered deductible as long as whatever work being done is for aesthetic purposes as opposed to strictly utility, and beautification of the area is the goal. These can include the planting of flowers, trees, and shrubs, as well as laying sod and adjusting the slope of the land. There are certain conditions that must be met though in order to deduct these costs.
Please note, this is not professional financial advice.
The Four Conditions for Tax Deductions
You are allowed a deduction for landscaping costs if you meet the following four conditions:
- The deduction is claimed in the year the amount is actually paid by you.
- The landscaping is for grounds around a building or other structure.
- The building or other structure is owned by you at the time of the landscaping.
- The building or structure is used by you primarily for producing income from it, or from a business.
If you don’t meet the conditions, the costs will be considered capital expenditures and can be added to the cost of the land you own instead of to the building. Also, you must own the building. If you lease or rent, you will not be able to deduct any of your landscaping costs.
Contact Greenbloom For Professional Landscape Services
If you’re looking to redo the landscaping on your Toronto-area property and would like the help of a professional company, contact Greenbloom. We offer both landscape consulting and landscape design, along with a variety of other lawn and garden maintenance services.