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Sale of Principal Residence must be reported to Canada Revenue Agency

It’s again this time of the year when we need to file Income Tax Returns. I would like to remind those individuals who sold their principal residence in 2017 that in order to claim the principal residence exemption they must report the disposition and designation of a principal residence to the Canada Revenue Agency (CRA) in their 2017 T1 Income Tax Return.

This new reporting requirement took an effect last year and, in general, it means that relief from the payment of capital gains tax when a principal residence is sold or gifted (disposed on death) is no longer automatic. To avoid paying capital gain tax, individuals will have to report the disposition and designation of a principal residence in a prescribed form to the CRA for the year of disposition. More details are here

Anna Gurevich

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