Budget 2013 - Lifetime Capital Gains Exemption

Notice to the reader

This measure has received Royal Assent.

Budget 2015 proposes changes to the lifetime capital gains exemption for qualified farm or fishing property.

What is the current maximum capital gains deduction that can be claimed in respect of a disposition of qualified property?

Currently, on the disposition of qualified property, an individual may be eligible for a capital gains deduction of up to $375,000, which is ½ of the $750,000 lifetime capital gains exemption (LCGE). These properties are qualified small business corporation shares, and qualified farm and qualified fishing property.

What changes are proposed for the LCGE?

For the 2014 and subsequent tax years, the budget proposes to increase the LCGE from $750,000 to $800,000. The budget also proposes to index the LCGE after 2014 for inflation.  The new LCGE limit will apply for all individuals, even those who have previously used the LCGE.

Where can I get more information about the increase to the LCGE?

The CRA is committed to providing taxpayers with up-to-date information. The CRA encourages taxpayers to check its Web site often. All new forms, policies, and guidelines will be posted as they become available.

In the meantime, please see the Department of Finance Canada's Budget 2013 documents for details.

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