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Comment by Kroem3r | Hacker News Reader

If you have a 'home office' then the interest you pay on your mortgage is an expense, and is thus a business deduction, as are hydro, gas, communications, etc.

If you have a business that borrows to buy and then rent houses, the same principle pertains; the interest on the mortgage is an expense.

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AIUI in some areas if the business claims for part of the main residence as a home office over a prolonged period then Capital Gains Tax can be due on that same fraction if there's a profit when the house is sold. IOW, it's not a free lunch.

I'm not very familiar with these rules, but you're definitely right that there are some complications. I have a friend who works for CRA and commented that he would never claim costs of a home office in a residence he owned, simply because the tax savings wouldn't be enough to make up for the headaches and tax audits which would result. (Claiming a home office in an apartment you're renting is much easier, since there's no capital gains to worry about and there's an easy paper trail for how much the space costs.)

If you have a 'home office' then the interest you pay on your mortgage is an expense, and is thus a business deduction, as are hydro, gas, communications, etc.

Only in proportion to the fraction of the house which constitutes your home office.

If you have a business that borrows to buy and then rent houses, the same principle pertains; the interest on the mortgage is an expense.

Right -- mortgage interest is a business expense when it's paid for a business reason. A principle residence is not considered to be an investment; it's considered to be a home.

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