If you sell real estate, expect the taxman to take a close look in continued CRA crackdown
The CRA has recently announced that the agency plans to be more proactive when it comes to real estate sales. Despite the need to report real estate sales (even on your principal residence which is except from tax), not every Canadian is reporting these sales on their tax returns. Over the last three years, over 30,000 files have been reviewed by CRA auditors who discovered nearly $600 million in additional taxes and resulted in over $43 million in penalties. In particular, pre-construction assignment sales are especially on the agency’s radar. If you plan on selling property, it’s best to report any sales and pay what you owe upfront as you can accumulate massive penalties from non-payment. The agency has and will examine more of these transactions every year.