Comments on: Reader Mail Bag Update: Lifetime Capital Gains Exemption

By: Tax Guy

Tax Guy — Tue, 24 Jan 2012 11:46:20 +0000

You don't get the capital gains exemption discussed above. Take a read through

By: Monika

Monika — Tue, 24 Jan 2012 04:25:28 +0000

I have a follow up question to capital gains exemptions on rental property.
I bought a house in 2008 and sold it in 2010. It was rented in 2008 and 2009, and then became my principal residence in 2010. Am I exempted from capital gains for selling the house in 2010 after having lived in it for almost 6 months?

Thank you.

By: Paley Business Consulting Services

Paley Business Consulting Services — Thu, 22 Jul 2010 16:59:25 +0000

If you own a corporation, it is important to ensure you have a qualified small business corporation in order to take advantage of the capital gains exemption.

By: Tax Guy

Tax Guy — Fri, 06 Mar 2009 10:30:38 +0000

@Yves

Your company appears to be earning passive income and may not qualify as a small business corporation and thus not eligible for the small business deduction. So it appears to be an investment corporation.

In addition, the nature of the business also appears that your earnings may be business income as opposed to capital gains and losses.

By: Yves

Yves — Fri, 06 Mar 2009 02:07:56 +0000

Hello,
If I have a company (incorporated) where the income come from selling options for premium, or in other cases the company may makes money from the difference between the price paid and price sold on index futures (not from interest on bonds or dividends). Typical holding period of an investment/option sale is ~20 business days.
Could it be considered active business income?
Or am I an Investment Holding Corporation?
Are those capital gains or revenues?
Thanks

By: Tax Admin

Tax Admin — Wed, 14 Jan 2009 00:24:55 +0000

If the whole property was purchased for the purposes of earning rental income, then the whole property would have been taxable property. There was a $100,000 general lifetime capital gains exemption that was eliminated in 1994. If you had not used the $100,000 capital gains exemption by 1994, you had the option to incur a “deemed disposition” and bump up your adjusted cost base to its 1994 value and take advantage of the $100,000 exemption. However, if you had not used the exemption in 1994, the time is long past to take advantage of the election.

If you occupied the property as your principal residence throughout the period and at no time claimed capital cost allowance, you need not claim a capital gain as you would be entitled to the principal residence exemption.

By: katherine Lawrence

katherine Lawrence — Sat, 03 Jan 2009 21:57:48 +0000

Hi,

We bought a home in 1980. Some part of the house has always been rented. The house was sold in 2008. We are trying to calculate how much of the house is capital gains tax exempt for each rental year. Is there any period since 1980 when the whole house might have been capital gains tax exempt despite the fact that some part of it was rented?

Cheers John and Katherine Lawrence

By: Sell or Redeem Shares in a CCPC | Canadian Tax Resource

Sell or Redeem Shares in a CCPC | Canadian Tax Resource — Tue, 23 Sep 2008 02:28:00 +0000

[...] the time, Investco was a CCPC and a qualified small business corporation. The company does not have a GRIP balance and therefore all dividends would be considered [...]

By: Capital-Gains » A Dollar Is a Dollar, and a Commission Is a Commission

Capital-Gains » A Dollar Is a Dollar, and a Commission Is a Commission — Mon, 07 Jul 2008 14:20:35 +0000

[...] Reader Mail Bag Update: Lifetime Capital Gains ExemptionDoes the LCGE cover only farm properties and qualified shares in stock exchanges or can it be used for residential properties capital gains, shares traded in foreign exchanges, or all shares traded in the Canadian or US exchanges ? … [...]