My question is: Canadian-specific
QUESTION: If I bought and moved into a house and decide 6 months later that I don't like it and sell that house to move elswhere do I attract capital gains on the sale of my home?
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david ingram replies:
And how high is up?
If you bought a house to resell any profit is taxable at ordinary income rates unless you can get it into another category.
If you bought a house or cabin to rent or use as a second home and decide ten years later to sell it for some reason or other, it is likely a capital gain.
If you buy a house and decide to sell it in six months, you can expect that the CRA "might" try and tax you at full rates unless you can show that the house was truly your principal residence and that you sold it for reasons other than making a profit.
reasons might be:
1. You lost your job
2. The school your child goes to is just not any good
3. You cannot stand your neighbour
4. You get divorced
5. you are transferred to another city
6. You are pregnant and need a bigger house
7. My favourite was a couple who ended up in a battle with organized druggies and sold out in fear of their lives.
However, if you bought a fixer upper and fix it up and sell it and buy another fixer upper around the corner and your kids keep on going to the same school and you shop at the same stores and catch the same bus, etc., you will be paying straight tax.
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Disclaimer: This question has been answered
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non-contractual duties are expressly denied. All readers should obtain formal advice from a competent financial, or real estate planner or advisor & appropriately qualified legal practitioner, tax or immigration specialist in connection with personal or business affairs such as at www.centa.com.
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