Personal Finance

Capital Gains Questions??

  • Last Updated:
  • Jun 24th, 2011 3:02 pm
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Newbie
Jun 19, 2011
6 posts
MARKHAM

Capital Gains Questions??

Hi all, looking for a quick lesson about capital gains tax.

Here goes:

I own two houses 1 is principal and 1 rental.

Purchased a third house for investment purposes but won't be ready for another year.

Looking to sell the rental property in a few months, since that is not my principal residence how much of a capital gain tax would I expect to pay? I guess my question is how is capital gains calculated? Just looking for a estimate so I can prepare myself for it.

If I sell my third property in a year's time would I have to pay capital gain again?

Any advice around property gains tax in my situation?

Any help is appreciated.
3 replies
Sr. Member
Feb 11, 2010
502 posts
262 upvotes
Yes you will have to pay capital gains on the 3rd property as well. Any property that is not your principle residence will be subject to capital gains.

The way it is calculated is the same as any other capital gain, divide it by 2 and you'll pay tax on that amount as though it were income.
Deal Addict
Jul 8, 2009
2028 posts
482 upvotes
Edmonton
Jor's post is correct, with the exception of his spelling of the word principal, LOL. I think it might be worth having a tax preparer help you with this one. this can get a bit complicated. Or heck, do it yourself if you're confident.
Jr. Member
Jul 24, 2008
130 posts
3 upvotes
A tax preparer would be recommended - the calculation of the gain could be tricky as you'll be able to establish an adjusted cost base by including legal fees, appraisal fees, etc. Plus, you may be able to use capital cost allowances to your advantage.

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