OMDREB works locally and with our provincial and national associations (OREA and CREA), to promote legislation and regulations that benefit homeowners and that help REALTORS® better serve their clients.
Our Government Affairs Committee keeps a pulse on local issues that impact our community.
Political Action Committee (PAC) Days
Attending the provincial and federal PAC Days is vital for the Board's GR Committee to stay up-to-date with issues in our province and across the country. The provincial conference is held every fall in Toronto while the federal affairs conference is held in Ottawa in the spring. These events provide an opportunity for REALTORS
® to speak directly to their Member(s) of Provincial Parliament (MPPs) and Member(s) of Parliament (MPs) about issues that affect homeowners and the real estate industry.
Current Local/Provincial Issues
Personal Real Estate Corporation
Registered salespeople are prevented from incorporating by two facets of the Real Estate and Business Brokers Act (REBBA), 2002.
First, REBBA, 2002 does not provide for the licensing of salespersons as personal corporations under the Act (Section 1.1). In addition, REBBA, 2002 does not permit a broker to pay commission to an “unregistered” entity (Section 30 c.).
In combination these sections prevent an individual salesperson from conducting business through a corporation and taking advantage of lower tax rates.
I’m a REALTOR®. What does this mean to me?
A Personal Real Estate Corporation (PREC) can be advantageous from an income tax perspective for high income salespeople. The corporate marginal tax rate for the $300,000 of active business income is approximately 25% lower than the top marginal rate on employment income. Therefore, the ability to incorporate would allow a real estate salesperson, depending on their level of business income, to save money on their income tax.
It should however be noted that the costs associated with becoming incorporated are significant. For example, the paperwork required to meet regulations can be onerous, tax rules can be complex and corporations can be expensive and complicated to set up and maintain.
OREA is working with the Government of Ontario to implement changes to REBBA, 2002 that would allow real estate salespeople to incorporate.
OREA believes that there are sound public policy reasons for permitting personal real estate corporations including: aligning the rights of real estate salespeople with other regulated professions and lowering taxes on Ontario businesses.
In addition, permitting personal real estate corporations will not affect consumer protection. Moreover, it will have limited implications for provincial revenue and it will not require significant legislative resources.
Current Federal Issues
Make Homeownership Affordable
The affordability of homeownership is a growing concern for first-time buyers. Meanwhile, the Home Buyers’ Plan (HBP), which allows first-time homebuyers to borrow up to $25,000 from their Registered Retirement Savings Plan (RRSP) to use as a down payment towards their home purchase, is losing its purchasing power to inflation.
We believe the HBP must keep pace with inflation, as measured by the Consumer Price Index (CPI). We advocate the HBP be adjusted incrementally by $2,500 to preserve its purchasing power so that it continues to help make homeownership affordable for first-time homebuyers.
Read more here about this initiative and why it benefits you.
Support Canadian Workers through Job Relocation
The cost of moving and finding a new home can discourage workers from relocating for a new job that will help them and their families prosper.
We believe the Home Buyers’ Plan (HBP) should be made available to help Canadians maintain homeownership after relocating more than 40 kilometers from an existing home to secure employment (in accordance with the ‘Moving Expense Deduction’ in the Income Tax Act).
Read more here about extending the HBP.