What are the risks of paying my home renovation project in cash & undeclared?

Some homeowners ask to pay their projects in cash to save on the tax portion of the invoice. However, non declared cash payments carry a lot of risks for the homeowner in addition to being illegal.

Risks during the renovations

Indeed, when a home renovation project is paid via non declared cash payments, the homeowner is exposed to the risk of having an uninsured home renovation project. In the event of an accident on the site or faulty workmanship or a dispute with the general contractor and/or subcontractors, the homeowner greatly reduces the chances of being in a position to receive compensation because no declared invoice has been issued & paid. In this scenario, taking legal action against a general contractor is unlikely to succeed, and moreover a court will likely highlight the homeowner is also at fault for initially avoiding paying taxes on the home renovation project costs.

Other risk during the property sale

In addition, it will be difficult for the homeowner to prove that some renovations were done at the time of the home sale (since there is no official receipt of the home renovations payments), which will penalize the price appreciation of the property.

Billdr’s tips

We suggest that you always pay for your home renovation costs in a declared way and electronically so that you, your family and your property are better protected. With Billdr you can pay via credit card and invoices & receipts are automatically generated.
Trying to save on GST and QST amounts by breaking the law is not worth running the risk of leaving your project uninsured: renovations are already expensive and you want to have peace of mind.

More guides

Home Renovation Glossary

Building a garden suite in Toronto

How to build a home addition

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