Leading up to the last federal budget, there was speculation that Canadians should brace for some changes in capital gains rules. That didn’t happen, and that’s good news. The sale of your principal residence for a gain is still a tax freebie. If you are selling a property other than your principal residence, then you’ll pay tax on 50% of any gain you realize. That rate first went into effect in 1972. The inclusion rate was increased to 66.6% in 1988 and then to 75% in 1990 as part of a two-stage increase. But it was ratcheted back down in 2000, and landed once again at the 50% rate where it has remained to today. You are now required to report the sale of your principal residence on your tax return. While still tax exempt, you may be asked to prove that it was your principal residence. If the feds do once again increase the inclusion rate, we can expect the government to provide ample advance warning to allow people to adjust their financial situations. So basically no real changes, but keep good records!
Want to find out more information on how capital gains from the sale of your residence will affect you? Speak to an extpert at MiMortgage.ca at 1 866 452-1100 now!
Today’s Announcement by the Bank of Canada will do nothing to keep the rising prices at bay.
Home Sellers in Toronto aren’t complaining about the ongoing increase in prices in the GTA according to The Globe and Mail, as a matter of fact prices are up 115 over the same time last year. The fact is its tougher for Home Buyers with homes being so much less affordable. TREB also notes that the volume of home sales have increased over last year with the GTA Condo Market continuing to demonstrate strong sales. Low interest rates are likely the thing prompting buyers to take part in such a high priced marketplace. With recent reports indicating that a soft economy will cause the Bank of Canadato hold rates until well into 2015 we will have to see if the prices will continue their climb. Get a same day pre-approval, apply now.