Income tax information you need to know if you bought or sold a home
If you bought or sold your home in or plan to buy or sell a home soon, the Canada Revenue Agency (CRA) has information to help you.
Principal residence exemption
Did you know that any profit–called capital gain–on the sale of your principal residence may be exempt from taxes? Generally, you do not have to pay tax on a capital gain when you sell your home if it was your principal residence for all the years that you owned it.
If you sold a property that was your principal residence, you must report the sale and designate the property as your principal residence on Schedule 3 of your income tax and benefit return. You must also fill in the appropriate sections of Form T2091(IND), Designation of a Property as a Principal Residence by an Individual (Other Than a Trust). Only one property can be designated as a principal residence per tax year per family unit.
Home buyers' amount
Eligible home buyers can claim $5,000 on line 369 of Schedule 1 of their income tax and benefit return for the acquisition of a qualifying home in 2017.
You may qualify for the home buyers' amount if you did not live in another home owned by you or your spouse or common-law partner in 2017 or in any of the four preceding years. You do not have to be a first-time home buyer if you are eligible for the disability tax credit or you acquired the home for the benefit of a related person who is eligible for the disability tax credit.
Home Buyers' Plan
You may be eligible to participate in the Home Buyers' Plan. This plan lets you withdraw funds from your registered retirement savings plan to buy or build a qualifying home for yourself. You can withdraw up to $25,000 in a calendar year, and you have up to 15 years to repay the amounts you withdraw.
To qualify for the Home Buyers' Plan, you have to meet these two conditions:
- you are a first-time home buyer
- you have a written agreement to buy or build a qualifying home for yourself
You are considered a first-time home buyer if, in the preceding four-year period, you did not live in a home that you or your spouse or common-law partner owned.
You must intend to live in the qualifying home as your principal residence within one year of buying or building it.
Home Buyers' Plan for persons with disabilities
You do not have to be a first-time home buyer to participate in the Home Buyers' Plan if you are eligible for the disability tax credit or if you are helping a related person who is eligible for the credit buy or build a home. The purchase or construction must be done to allow a person with a disability to live in a home that is more accessible or better suited to their needs.
GST/HST rebate on new homes in Canada
If you constructed or substantially renovated a house for use as your primary place of residence, you may also be eligible for this rebate.
For more information on the GST/HST new housing rebate, refer to guide RC4028, GST/HST New Housing Rebate.
Home accessibility expenses
If you are a qualifying individual (65 years of age or older at the end of 2017 or eligible for the disability tax credit) or an eligible individual claiming certain tax credits for a qualifying individual, you may be able to claim eligible expenses paid for renovations that make your dwelling more accessible.
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