Principal residence Canada capital gains, How does the Canada Revenue Agency view it. A very common question asked by Canadian Real Estate investors about their principal residence. How their property does qualifies as principal residence and what is Canada Revenue Agency’s parameter.
Principal Residence Canada Capital Gains
Principal residence Canada capital gains depends upon always about the size, usage and ownership. It is important for one to know because this is only tax loophole available for Canadians.
A property qualifies as your principal residence In Canada for any year if it meets all of the following four conditions:
1. It is a housing unit, a leasehold interest in a housing unit, or a share of the capital stock of a co operative housing corporation you acquire only to get the right to inhabit a housing unit owned by that corporation.
2. You own the property alone or jointly with another person.
3. You, your current or former spouse or common-law partner, or any of your children lived in it at some time during the year.
4. You designate the property as your principal residence.
The land on which your home is located can be part of your principal residence. Usually, the amount of land that you can consider as part of your principal residence is limited to 1/2 hectare (5,000 square meters), which converts to about 1.24 acres (53,819 square feet).
Since these are requirements are based by Canada Revenue Agency, they intend to apply across Canada. If you have further questions, you should speak directly to Canada Revenue agency or your accountant
However, if you can show that you need more land to use and enjoy your home, you can consider more than this amount as part of your principal residence. For example, this may happen if the minimum lot size imposed by a municipality at the time you bought the property is larger than 1/2 hectare.
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The above information is provided as a guideline and is not intended to give a professional legal advice. Please consult a real estate lawyer for their opinion on your particular case.
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