selling house after we leave

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eortlund
Posts: 272
Joined: Tue Aug 07, 2007 12:18 pm

selling house after we leave

Post by eortlund »

Our house still hasn't sold and we leave Canada June 29. However my husband gets paid through July so Iam tthinking we will be non-resident in August.

My understanding is that if it doesn't sell this month, I should get a Fair Market Value assessment? Or arrange it for late July?

Once it sells, no tax due for a year, is that right? Any forms that need to be submitted to CRA? Anything else?
nelsona
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Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Post by nelsona »

If he sells as non-resident there are indeed forms that he must submit before/after sale to avoid withholding and penalties. make sure your broker is aware of these.
If you leave on June 29, that is your departure date. Being paid is not a sign of residence.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
eortlund
Posts: 272
Joined: Tue Aug 07, 2007 12:18 pm

Post by eortlund »

Thank you. By broker, do you mean our realtor or our lawyer? Or should we just do it? Can you tell me the forms required?
eortlund
Posts: 272
Joined: Tue Aug 07, 2007 12:18 pm

Post by eortlund »

Also does it make a difference that we are not going to the UK June 29? We are going to the US for the month of July on vacation before heading to the UK in August.
nelsona
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Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Post by nelsona »

A little bit of legwork on your part, please.

http://www.cra-arc.gc.ca/tx/nnrsdnts/cm ... .html#nrcp

By broker, anyone who is going to handle the sale and its proceeds.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
eortlund
Posts: 272
Joined: Tue Aug 07, 2007 12:18 pm

Post by eortlund »

Thanks, I had seen that page. But wasn't sure what applied to people selling within the year and what didn't. I will study it more closely. Maybe we shouldnt use our local lawyers and should hire someone who specializes in this.
eortlund
Posts: 272
Joined: Tue Aug 07, 2007 12:18 pm

Post by eortlund »

Are these forms complicated? I understand it will be a Certificate of Compliance and a form saying the house was my principle residence.

Local lawyer said I would need an accountant to do it. Local accountant said I need a cross-border accountant to do it. ? Would rather not pay those fees if I don't have to, but also don't want to get it wrong.
nelsona
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Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Post by nelsona »

Look over the forms yourself. Simpler than doing your taxes. No "need" for a pro to do these.

You just need to make sure that your "broker/lawyer/agent/doula/whatever" knows that these need to be filed, and when.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
eortlund
Posts: 272
Joined: Tue Aug 07, 2007 12:18 pm

Post by eortlund »

Never thought about doing this with a doula, thanks for the suggestion. :)

Will look at forms, I figured accountant might be exaggerating how hard it was.
nelsona
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Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Post by nelsona »

just wanted to make sure I covered all the bases, since broker wasn't clear to you before.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
eortlund
Posts: 272
Joined: Tue Aug 07, 2007 12:18 pm

Post by eortlund »

Yeah I don't think the professionals involved in this sale encounter this issue very much.
eortlund
Posts: 272
Joined: Tue Aug 07, 2007 12:18 pm

Post by eortlund »

Have printed out form T2062 and Form T2091 (IND). Is this correct? If so, I will study them and the instructions and come back with any other questions.
eortlund
Posts: 272
Joined: Tue Aug 07, 2007 12:18 pm

Post by eortlund »

Just to be clear, because it's been our principal residence for 10 years and we will not have been gone a year, I should question anyone who tells me the CRA will want them to hold back 25% (of gains, or even purchase price as one person told me)? And it's specifically the principal residence exemption that prevents that holding back?

Also is it the T2062 or T2062A for a basic house that has never been rented out?
nelsona
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Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Post by nelsona »

If you do not provide this form, 25% of the PROCEEDS of the sale (that is the selling price, not the profits) MUST be withheld by the buyer, regardless of whether it was your Principal home or not, and remitted to CRA. Doesn't matter if you rented or not, or if it was a cottage, or if you never made a penny on the house.

It's the proper submission of the form that is important.

I'll let you figure out which form to use. (Clue: only one of them lists principal residence exemption in the instructions).
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
nelsona
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Joined: Wed Oct 27, 2004 2:33 pm
Location: Nowhere, man

Post by nelsona »

The T2206 form, not the T2901. the T2901 accompanies the T2206.

Without T2206, you only get 75% of the sale (which could be problematic if you haven't paid down your house by at least 25%. You could have to come up with the extra to close the mortgage.

So, start working on T2206.
nelsona non grata. Non pro. Please Search previous posts, no situation is unique as you might think. Happy Browsing :D
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