Taxes on house appreciation in Canada?
June 18, 2007 4:13 AM Subscribe
If I sell the house I live in, will I have to pay taxes on the difference between the original purchase price and the sale price?
I'm in Canada.
I own a house which in 1970 cost about $5,000. The suggesting listing price of houses in this neighbourhood is on average $625,000 (and given that in most cases the house is knocked down for construction, prices are relatively even across the board). Title is clear.
Will I have to pay taxes on the difference between the purchase price 37 years ago and the current expected sale price?
(If it matters, my parents bought the house in 1970. After my father died in 1998, I returned to town, moved in, and the property (which was in my parents' names as joint tenants) was transferred to my mother and me as joint tenants. I have lived here since then, and also lived here from 1970 to 1984.)
I'm in Canada.
I own a house which in 1970 cost about $5,000. The suggesting listing price of houses in this neighbourhood is on average $625,000 (and given that in most cases the house is knocked down for construction, prices are relatively even across the board). Title is clear.
Will I have to pay taxes on the difference between the purchase price 37 years ago and the current expected sale price?
(If it matters, my parents bought the house in 1970. After my father died in 1998, I returned to town, moved in, and the property (which was in my parents' names as joint tenants) was transferred to my mother and me as joint tenants. I have lived here since then, and also lived here from 1970 to 1984.)
Response by poster: Thank you! It's my only residence and has been for 9 years, so that takes a load off my mind.
posted by watsondog at 4:54 AM on June 18, 2007
posted by watsondog at 4:54 AM on June 18, 2007
Best answer: If it's a principal residence, there's no tax implications. From the Canada Revenue Agency web site:
Topics about selling your home
Do you have a capital gain?
If the property was your principal residence for every year you owned it, you do not have to report the sale on your return. However, if at any time during the period you owned the property it was not your principal residence, you may have to report all or part of the capital gain.
There's more detail at the CRA web site regarding when a capital gain is triggered on a home. There can be a "deemed disposition" of a home if an owner dies, but that usually doesn't occur when the home is held in joint tenancy.
posted by gwenzel at 4:58 AM on June 18, 2007 [1 favorite]
Topics about selling your home
Do you have a capital gain?
If the property was your principal residence for every year you owned it, you do not have to report the sale on your return. However, if at any time during the period you owned the property it was not your principal residence, you may have to report all or part of the capital gain.
There's more detail at the CRA web site regarding when a capital gain is triggered on a home. There can be a "deemed disposition" of a home if an owner dies, but that usually doesn't occur when the home is held in joint tenancy.
posted by gwenzel at 4:58 AM on June 18, 2007 [1 favorite]
This thread is closed to new comments.
posted by thparkth at 4:45 AM on June 18, 2007 [1 favorite]