Reporting the sale of a principal residence

Instructions

1. Open the tax software
2. Review the Background information and Required slips (tax slips, receipts, etc.)
3. Provide all required information for the appropriate sections of the tax software
4. Once completed, compare your results with the solution provided
5. Afterwards, refer to the Takeaway points

Background information

Situation

Igor sold his property for $170,000.00 on December 5, 2024. He purchased the property on January 15, 1999 and it has been his principal residence every year he has owned it.

Igor also received Advanced Canada workers benefit payments.

Required slips

T4 – Statement of Remuneration Paid (Botanical Gardens Inc.)

RC210 – Advanced Canada workers benefit (ACWB) statement

Review your results

Solution to Reporting the sale of a principal residence.

Takeaway points

Steps to follow

1. Review their background information and required slips
2. In CRA Questions, select Yes from the Did you sell a principal residence in 2024? drop-down menu
3. In Interview setup, tick the box next to Employment income and employment insurance benefits (T4, T4E/RL-6) in the Employment and other benefits section
4. Click T4 and employment income in the left side menu, then click the + sign next to T4 income (earned in any province except Quebec) to enter the information from the tax slip
5. Click Other information slips in the left-side menu, then click the + sign next to RC210 – Canada workers benefit advance payments statement [Federal line 41500] to enter the information from the tax slip
6. Click Capital gains (or losses) and ABIL in the left side menu, then click the + sign next to Personal use property (Including the principal residence) in the Capital gains and ABIL section
7. Enter the dates into the Date of acquisition (dd-mm-yyyy) and Date of disposition (dd-mm-yyyy) fields
8. Enter $170,000.00 into the Proceeds of disposition field
9. In the Principal residence section, select Yes from the Designation of the property as a principal residence? drop-down menu
10. In the Address of the principal residence section, enter the required information and select T2091 - Designation of a property as a principal residence by an individual from the Select the form to use (T2091 or T1255) drop-down menu
11. In the Designation section enter the year from Date of acquisition (dd-mm-yyyy) into the From field and the year from Date of disposition (dd-mm-yyyy) into the To field 

Since the property Igor sold was his principal residence for all the years he owned it, it does not affect his eligibility for CVITP services and the amount is not included on line 12700 of his tax return. However, Igor has to report the sale and designate the property as his principal residence on his tax return because the sale of the principal residence occurred after 2015. The software automatically completes Schedule 3 and Form T2091.

For more information, refer to UFile instructions.