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Cem20
Level 1

Damages to Rental Property

8K was awarded due to tenant damages on a rental property. What is the treatment of the monetary award by the CRA and how is this shown in QBs.  Not all of the repairs could be completed in the tax year due to supply chain issues.

 

1 Comment 1
LeithG
Level 7

Damages to Rental Property

Hi Cem20

 

I would suggest the award be recorded as a 'below the line' Extraordinary Item (non-operating income/expense).  Similarly, the money spent to repair the damage would be recorded to the same account, or an offset with each of these being a 'child' of the larger account.

 

In this way, the expenses and 'income' are recorded separately from regular operating income/expenses and can be analysed by your tax professional at year end.

 

Hope this helps!

Leith.

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