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Thursday, October 27, 2016

The New Principal Residence Reporting Requirements – Large Implications for the Average Canadian

This month, the Canadian government announced changes to the reporting requirements when a person sells his or her principal residence. Not being an accountant, I am not the best person to explain the changes or the reasons for them, but I do want my readers to be aware of the information. So, I have found a really good blog post by Mark Goodfield, a Canadian accountant who blogs at The Blunt Bean Counter, and I'm sharing it with you here.

Click here to check out Mark's article on the change to the principal residence reporting and how it might affect you.

2 comments:

  1. Lynne
    A person owns both a house and a cabin for 20 years and then sells the house and claims it as their principal residence, paying no capital gains. They then use the cabin for the next five years as their principal residence and during that time the value of the cabin increases at a much greater rate than it did in the first 20 years. Lets say in the first 20 years it increased $100k and then again increased in value in the next 5 years by $100k.
    Using the CRA's formula, if the person was to sell the cabin, the capital gain would be around $152k when in fact it should only be $100k.
    Do you know if the CRA makes allowances for a situation like this?

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