Real Estate

"Gifting" money to parents to purchase real estate

  • Last Updated:
  • Nov 14th, 2020 1:21 pm
Apr 16, 2019
8 posts
1 upvote

"Gifting" money to parents to purchase real estate

Hey y'all,

My parents are moving to Canada and need a place to live in. Because Canada housing market is expensive, I will have to pay for the half of the house.

Here's where it gets tricky for me because I'm trying to pay as little tax as possible...
If we make this new home a joint-ownership, I will have to pay capital gains tax on my portion of investment because this won't be my principal residence (I already own another condo which is my principal residence). So can I send my money as a "gift" to my parents so they can purchase the house with full ownership? When they sell the house, they will be able to get principal residence exemption so they won't pay any taxes on the gains. Once house is sold, they will "gift" my money back including the half of the capital gains during the ownership of the house.

Would this work?
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