In the 2016 Federal Budget, the tax rules were changed to require taxpayers to report the disposition of an interest in a principal residence. Previously, most taxpayers wouldn’t have reported this.
If you have sold or transferred an interest in your principal residence during 2016, then you must report it on your 2016 personal tax return. You will need to know the date that you acquired the principal residence, the number of years that you designate the property to be a principal residence and the sale proceeds.
If this property has had multiple uses, such as rental or business, then seeking assistance from a tax professional would be advised.
Remember that a transfer of or deemed disposition of an interest in a principal residence also counts – either through death or gift, or otherwise.
If you fail to report a disposition of property, including a principal residence, the Canada Revenue Agency can levy a penalty of $100 per month that the property remains unreported up to a maximum of $8,000 for this missing information.
For information from the CRA, please click on this link:
If you require further information, or would like some assistance with this new reporting please contact Moeller Matthews and ask to speak with one of our Chartered Professional Accountants.