Recently the Canada Revenue Agency (CRA) changed its administrative rules so that, unlike the past, if you sell your principal residence in 2016 or later years, you must report:
- The sale including the date and price of acquisition, the sale price and date and a description of the property; and
- The fact that the property was a principal residence
on your income tax return filed in 2017 if you want to claim the full principal residence exemption. The exemption means that no tax is paid on a property that is the principal residence of the seller. In the past CRA did not require taxpayers to report the capital gains on the sale of principal residences.
If you don’t claim the exemption then CRA will treat any gain in the value of the property as a taxable capital gain. One half of capital gains are deemed to be income in the year in which the capital gain is realized. The top marginal rate for income taxes in British Columbia is nearly 48% for income in excess of $200,000.
What’s a great way to make some cash without exerting a ton of energy? The stock market of course! Where else can you pick a lucky fund, invest some hard earned cash and come out with a big return? Now, you could choose to do it yourself, that would be a cheap way of getting it done yet you may worry some of the fact that you don’t know too much about the idea. It would be silly to invest a bunch of money on a hunch or a ‘stock tip’ from a friend who knows less about it than you do. What are your options then? Hire a stock broker.
Stock brokers are required to go through educational requirements in order to serve you and your money, such as a completed Canadian Securities Course, and thank goodness too, because you want to make sure you are in the best hands. When picking a stock broker, how do you know who is the best? To pick do you
A) Go with the trader who offers you the best rate on your trading, the professional that offers you the biggest discount saving you money per trade?
B) Go with the trader that has a track record of making their clients significant gains and produces extraordinary results?
The answer is B. The answer should always be B.
The same goes for real estate. We are in an extraordinary time where we have begun to see competitive convergence in our market place, where we have so many Real Estate professionals competing over price to help sell your home. This is such a great opportunity to help the industry get better because it lets those who shine be brightest of them all. When choosing to sell your home, are you worried about who will give you the best discount, or who will sell your home and net you the most amount of money? Like a stock broker, real estate professionals are not all created the same and I caution you, to pick based on track record and results, not discount. Because doing the latter would be considered silly, wouldn’t it?
Blog post provided by Darin Germyn Personal Real Estate Corporation, a REALTOR® with Macdonald Realty in South Surrey / White Rock. Visit Darin’s blog at Germyn.ca