Expenses and daycare for only short term

I don't think I will do my home daycare for the long haul (my plan had been until my oldest is in kindergarten). Although I am liking it, I doubt I will do this for more then another yr or two.

If I claim expenses as part of my home daycare e.g a portion of the cost of getting new windows installed in the basement which is exclusively used for daycare. Will I have to pay a portion of this back after I close up shop? I am thinking this could be a great opportunity to get some things done around the house and be able to write off a portion of the cost. Anyone know?

Thanks

Good question. I had put all new flooring in my basement which is exclusively for daycare and never thought if the deduction might need to be prorated. My accountant has never asked how long I intended to stay in business regarding any improvements I've made. Hmmm

I attended a workshop with the CRA (Canada Revenue Agency) and the revenue employee stated that you can write off the improvements for your daycare but to be very careful. If you do write off something that would add to the value of your overall property then the government can tax you when you sell your home for capital gains........
Don't kill the messenger though LOL :ohmy: This is just what I heard from one lady that held a workshop through the CCPRN here in Ottawa about "Daycare as a business"
Who taught us what we could and could not write off. She basically said yes and no at the same time and that you can choose to do it or not choose.
She basically stated that the only "safe" item to write off for your home would be paint.......
But I bet if you talk to an accountant he could find a way around this!!!!

By prorating the cost of major repairs you are claiming only while doing daycare in the sense of 20% per year if you are only in business two years means there is still 80% of the cost you won't be claiming on your taxes.

I use the criteria of is it something I could do every year such as we put in a new deck so not what you would do every year as compared to paint which is done more often.