Article Source: Canada Revenue Agency: Buying or selling a home? What you should know.
February 3, 2017
If you bought your home in 2016 or plan to buy a home, the Canada Revenue Agency (CRA) has information that may help you.
Principal Residence Exemption
Sold your principal residence in 2016? File a tax return and claim the principal residence exemption for capital gains.
Starting with sales in the 2016 tax year, you are required to report basic information (date of acquisition, proceeds of disposition (e.g. sale) and address) on your income tax and benefit return when you sell your home to claim the full principal residence exemption. You do not have to pay tax on any capital gain when you sell your home if it was your principal residence for all the years you owned it and did not use any part of it to earn income. A property may qualify as your principal residence for any year that you or certain family members lived in it, if none of you designated another property as a principal residence for that year.
Home buyers’ amount
If you are a first-time home buyer, you may be able to claim $5,000 for the purchase of a qualifying home in 2016.
You qualify for the home buyers’ amount if you did not live in another home owned by you or your spouse or common-law partner that year or in any of the four preceding years.
A qualifying home must be located in Canada and registered in your name and/or your spouse’s or common-law partner’s name according to the applicable land registration system. It includes existing homes, such as single-family houses, semi-detached houses, townhouses, mobile homes, condominium units, apartments in duplexes, triplexes, fourplexes, or apartment buildings, as well as homes under construction.
You do not have to be a first-time home buyer if:
you are eligible for the disability tax credit; or you acquired the home for the benefit of a related person who is eligible for the disability tax credit.