Asked
Figured I'd ask here before asking an accountant.
If you decide to no longer rent your investment property but move into it and turn it into your primary residence, do you pay capital gains during that tax year when it stopped being an investment or do you pay if and when you eventually sell the place?
I only ever remember seeing a question while finally taxes about if an investment was sold.
Clint’s answer
Hi Maria. No capital gains paid until you sell, however, you are obligated to declare the change in use.
And I would strongly advise you get an appraisal at the time of the change.
Once you dispose or sell the property you will pay capital gains on the increase in value during the time it was a rental property, but not when it was your principal residence. This is why the appraisal is recommended.
Fill out the form I have linked a copy to in a comment below, and file it with CRA.
January 4, 2025
From Ask Clint: real questions from a Canadian public finance forum, answered by Clint Cole. Names are changed. This is general information, not advice for your situation, and rules and dollar figures may have changed since Clint answered. Terms