Canadians who have sold their homes last year have been mandated to report the transaction to the Canada Revenue Agency.
Income tax returns should now include basic information surrounding such a transaction, the description of the property, the year of purchase, and any proceeds of the sale.
“If you’ve always lived in your home as your principal residence and you sell it in any year, don’t worry, there’s no additional tax to be paid,” according to Brian Brophy, tax partner at Deloitte.
“All you need to do is make sure you report it on your tax return,” Brophy added, as quoted by the Hamilton Spectator.
Violations of this new provision are subject to penalties of up to $8,000, the CRA warned.
The change will make it easier for the CRA to detect illicit tax activity.
“This provides a tracking mechanism ... in order for them to get a better view as to the amount of transactions that are out there,” Brophy said.
Across Canada, 536,118 homes were sold through the Multiple Listing Service in all of 2016, according to the Canadian Real Estate Association.
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