Save Taxes With These Real Estate Deductions

Real estate is one of the most powerful tools for growing wealth, and the benefits go beyond just rental income and long-term appreciation. If you're a real estate investor in Calgary, there are several tax deductions available that can significantly reduce your taxable income and boost your overall returns.

Whether you own a single rental unit or a growing portfolio, knowing what you can legally deduct is essential to maximizing your profits.

Here are some of the most valuable real estate tax deductions you should be taking advantage of.

1. Mortgage Interest

This is one of the largest deductions available to property owners. If you’ve taken out a mortgage to buy your investment property, the interest portion of your monthly payments is fully deductible.

This can add up to thousands in annual tax savings, especially in the early years of your mortgage when interest makes up the bulk of your payment.

2. Property Taxes

As a landlord, you can deduct the full amount of property taxes you pay on your rental properties. This is separate from your personal residence, and only applies to income-producing real estate.

Pro tip: If you own property in Calgary and feel your taxes are high, check out our blog on reducing property tax—we've got tips to help you there too.

3. Operating Expenses

Anything you spend to keep the property running is usually deductible. Common examples include:

• Property management fees (yes, even those paid to LeaseWell!)

• Advertising and marketing for rental listings

• Utilities (if paid by you instead of the tenant)

• Office supplies or software used to manage the rental

• Cleaning and maintenance services

  
  

The CRA expects you to operate like a business—so track everything and save your receipts.

4. Repairs and Maintenance

Keeping your property in good shape is not only good practice—it’s also tax-deductible. Things like:

• Plumbing repairs

• Painting

• Replacing broken appliances

• Snow removal and landscaping

  
  

Important: Upgrades or improvements (like installing a new kitchen or deck) are considered capital expenses, which you’ll depreciate over time, not deduct all at once.

5. Depreciation (Capital Cost Allowance)

One of the most overlooked deductions is depreciation, or what the CRA calls Capital Cost Allowance (CCA). It allows you to deduct a portion of the property’s cost over its useful life—even though real estate typically appreciates in value.

This is especially valuable for investors looking to offset strong rental income without reducing cash flow.

Talk to a qualified tax professional before claiming this—there are rules about recapture when you sell the property.

6. Insurance Premiums

If you’re paying for landlord insurance (which you absolutely should be), the premiums are fully deductible. This includes:

• Building and liability insurance

• Content insurance for furnished rentals

• Rent loss insurance, if applicable

  
  

You can also deduct business insurance if you're operating under a corporation.

7. Professional Services

Whether you’re paying for legal advice, accounting services, or property management through LeaseWell, those costs are deductible too.

If you’ve consulted a real estate lawyer for lease agreements or hired an accountant to manage your books, those are considered business expenses under the CRA guidelines.

Final Thoughts

Real estate investing comes with its share of responsibilities—but it also brings powerful tax advantages that many investors don’t take full advantage of. By understanding and applying these deductions, you can reduce your tax liability, increase your net income, and build long-term wealth more effectively.

Not sure where to start?Let LeaseWell help you manage your rental professionally—and keep your books organized for maximum tax benefits. Start with a free rental property evaluation and see how much more your investment could be earning.