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How to report the sale of rental property

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My wife and I purchased a condo unit in June, 2003 and used it as our principle residence. In June, 2010, we moved out to a detached and rented out the unit. We sold the condo last June.

When I filed the CCA, I could only fill the purchase date of the condo. I could not find a place to claim that it was used as our principle residence until 2010. Hence the capital gain was exactly doubled. I already marked it as the last year of rental.

Much appreciated if somebody can help. I'm already confused by all the terms.

Thanks

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Hi,

On October 3, 2016, the federal government announced an administrative change to the reporting requirement for the sale of a principal residence to the Canada Revenue Agency (CRA).

Therefore, starting with tax year 2016 and subsequent taxation years you will be required to report the basic information, namely the date of acquisition, the proceeds of disposition and the description of the property.

For more information, please visit the following link

https://www.canada.ca/en/revenue-agency/programs/about-canada-revenue-agency-cra/federal-government-budgets/budget-2016-growing-middle-class/reporting-sale-your-principal-residence-individuals.html

To report the sale of your principal residence in a rental building, please follow the steps below:

1. In the "Left-side menu on the Interview tab", select the "CRA Questions" topic.

2. On the page that appears, go to the line "Did you sell a principal residence in 2017?". The sale of a principal residence must now be reported, along with any principal residence designation.

3. If you answer "Yes", the heading "Capital gains (or losses) & ABIL" will be generated in the "Left-side menu on the Interview tab".

4. On the page that appears to your right, click on the plus sign "+" icon to the right of the line "Real estate, depreciable property and other properties".

5. On the page that appears, enters the relevant information in the first fields. If you are a co-owner of the residence with your spouse, go to the line "Your percentage share of capital gain/loss recorded here" enter your percentage.

6.The following line will be generated "Do you wish to transfer the remainder to your spouse's tax return (if applicable)?".

7. If you answer "Yes" you do not need to answer the CRA's question "Did you sell a principal residence" in your spouse's file because the program will transfer the information into their file.

8. In the "Principal Residence" section, go to "Designation of the property as a principal residence?" and answer "Yes" if the property that was sold was your principal residence as defined by the CRA and enter the address of the principal residence in the following fields. NOTE: By selecting "Yes", you confirm that all the information provided corresponds to the information you provide to Revenu Québec.

9. Next, go to the "Designation" section and select the taxation period in which the property was designated as the principal residence. In the fields that follow, enter the period from the year of beginning to the year of the end of occupation of your residence.

10. However, if you have not permanently resided in your principal residence, click the plus sign "+ Add another" icon to create another occupancy period for your residence.

11. If you rented your residence in the unoccupied period, go to the line for "Change in use of property and election under section 284 or 286.1". If you answer "Yes", a field will be created to indicate the period (from what year to what year) during which the residence was leased.

Schedule 3 will be generated as well as page 2 of this schedule by the program which will indicate that the property was your principal residence for all the years during which you were the owner.

In addition, Form T2091 "Designation of a property as a principal residence by an individual" will be generated by the program.

Also, for residents of Quebec, Schedule G and Form TP-274 will be produced by the program.

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Hi Cristina,

Thank you for the info, this is very helpful. I have a question about step 5:

Quote

5. On the page that appears, enters the relevant information in the first fields. If you are a co-owner of the residence with your spouse, go to the line "Your percentage share of capital gain/loss recorded here" enter your percentage.

I own a rental property with 3 apartments together with my spouse. We previously occupied one of the apartments, therefore 33% of the property was for personal use. In June 2018 we bought a condo and moved (changed our principal residence). The apartment that we previously occupied was rented in the same month.

How do I report that the 33% for personal use became 0% starting June? The part that confuses me is that the 33% is shared 50/50 with my wife, not sure how Ufile adjusts for this.

Thanks again for your help.

 

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