Real estate income is counted minus allowable costs, excluding depreciation. If the owner resides in the building, these COSTS are DIVIDED between the rented space and the space he or she occupies.
During an initial application for assistance or during the annual review of client files, eligible expenses should be divided and reported on a monthly basis for the next 12 months.
When a person receiving assistance incurs a major expense and the beneficiary notifies the agent, the calculation should be adjusted based on the newly submitted receipts.
The ELIGIBLE EXPENSES include the following:
- mortgage interest and interest on a personal loan contracted in order to renovate a building (but not the part that represents the reimbursement of capital);
- fire insurance (not the portion of the premium that covers furniture);
- the cost of maintenance and repairs that keep the building in good condition (not costs that increase the value);
- heating and lighting costs (if provided by the owner);
- advertising costs, long distance telephone charges or payment of interest on a personal loan when incurred exclusively to earn rental income.
LEASED SPACE WITHOUT ADEQUATE CONSIDERATION constitutes a voluntary restriction of income. The rental value of the space is calculated and the difference between a reasonable rent and the actual rent is considered as income.