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| October 2016 |
| Principal residence exemption – significant changes |
| Sankalp (Sunny) Jaggi, CPA, CA, MTax, CFF, is a tax manager in the Toronto office of Collins Barrow. |
| On October 3, 2016, among a series of other measures, the Department of Finance (“Finance”) introduced significant changes to the principal residence exemption rules under the Income Tax Act (Canada). The mandate of these changes was specifically to “improve tax fairness by closing loopholes surrounding the capital gains exemption on the sale of a principal residence.” The proposed changes to the principal residence exemption rules effectively limit the ability of certain taxpayers to reduce or eliminate the capital gain on the sale of their home. |
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| Collins Barrow periodically publishes Tax Flash for its clients and associates. It is designed to highlight and summarize the continually changing tax and business scene across Canada. While Tax Flash may suggest general planning ideas, we recommend professional advice always be sought before taking specific planning steps. |
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