Sale of Canadian Rental Property

toad · Post by **toad** » Mon May 07, 2012 12:05 am

Hi,

When selling a canadian rental property, do I file a Section 216 (for rental income) and non-resident T1 (for cap gains and CCA recapture?), or just lump everything on T1?

Where do selling real-estate fees go? As an adjustment to cost basis (preferred?), as a reduction in sale price or as an expense against income on the 216? I would hope I could adjust cost basis since I could reduce CCA recapture instead of cap gains and save tax.

Thanks

nelsona · Post by **nelsona** » Mon May 07, 2012 6:09 am

216 for rental.non-resident T1 for anything else.

nelsona · Post by **nelsona** » Mon May 07, 2012 6:10 am

Costs of selling reduce your proceeds.

JGCA · Post by **JGCA** » Mon May 07, 2012 8:21 pm

As Nelson pointed out the selling costs like commission paid will reduce the proceeds od disposition, but I do not see how this will reduce recapture and capital gains. If the recapture is reduced because the proceeds are lowered by the selling costs then this means you have not exceeded ACB because if you did then you have a cap gain and the recapture is purely all teh CCA you have taken in the past, the only way it will reduce recapture is if the proceeds are lower than ACB and in this case you have a terminal loss on depreciable property or a cap loss on say land.

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