Firm News: 40% of our lawyers recognized by Best Lawyers
Tuesday December 6, 2016

New CRA Reporting Requirements for the Sale of your Principal Residence

Authored by: Andrew P. Nicol Posted in: Real Estate

The CRA has implemented new reporting requirements for the sale of a principal residence. While you will still not have to pay tax on the sale of your home, if it meets the principal residence exemption requirements, you will have to report the sale of your principal for any sale on or after January 1, 2016. This will be reported on Schedule 3, Capital Gains of the T1 Income Tax and Benefit Return and you will need to include the date of acquisition, proceeds of disposition, and a description of the property.

What happens if you do not report the sale of a Principal Residence?

If you fail to report the sale of a principal residence, you will not be able to utilize the principal residence exemption that applies to your property, which could result in you having to pay tax on any gain from the sale.

If you forget to make a designation of your principal residence in the year that you sell it, the CRA can accept a late designation in certain circumstances. If you do forget to report the sale, it is important to contact the CRA to have your income tax return amended for that year. While the CRA may accept a late designation, the CRA does have the authority to apply the following penalty, which would be the lesser of either:

The CRA has said that for the sale of principal residences during the 2016 tax year, the penalty for a late-filing of a principal residence designation will only be assessed in the most excessive cases. To avoid even the chance of having to pay this penalty, include the sale of your principal residence on your income tax return, but if you forget, immediately notify the CRA to request that your income tax return be amended.

Share This Post:

Ask a question about this post.

Any Questions

Recent Blog Posts

Blog Post | Tuesday December 8, 2020

TRADEMARKS: The Perspective of the Average Consumer

Authored by: Marc J. Belliveau Posted in: Business Law

In a court of law, a judge must often assess a person’s act or omission against a certain legal standard of human conduct to determine whether that person’s behaviour was harmful or unlawful.

Read full article
Blog Post | Tuesday December 8, 2020

Who’s liable for a dog attack?

Authored by: Shafic A. Khouri Authored by: David S.R. Parker Posted in: Personal Injury

If your dog does injure someone, then you could be required to compensate that person for those injuries.

Read full article
Blog Post | Friday November 20, 2020

Manitoba Required to Expand their Definition of Parent

Authored by: Terrance G. Sheppard Posted in: Family Law

The Manitoba Court of Queen’s Bench declared that the current definition of “parent” and related provisions in Manitoba’s Family Maintenance Act violate the equality rights guaranteed under the Canadian Charter of Rights and Freedoms.

Read full article