T1 - How do I record a deferred capital gain on replacement real estate property

Forum|Forum|4 years ago
January 19, 2022
1 reply
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T1 - How do I record a deferred capital gain on replacement real estate property.

Can someone provide me with step by step instructions on how to record this? Thank you!

ProFile (Canada)

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M

MikeACGA

Level 4

Have a look at ITA s.248(1) "former business property" and see if it fits your situation. You might discover that what you are trying to do is not legal. IT-491 might also assist.

K

Karen K1Author

Level 2

From CRA's site - Replacement property

In some cases, you can postpone or defer including a capital gain or recapture of capital cost allowance (CCA) in calculating income. You might sell a business property and replace it with a similar one, or your property might be stolen, destroyed or expropriated, and you replace it with a similar one. To defer reporting the gain or recapture of CCA, you (or a person related to you) must acquire the replacement property within the specified time limits and use the new property for the same or similar purpose.

You can also defer a capital gain or recapture of CCA when you transfer property to a corporation, a partnership or your child.

R

roymabroor

Level 2

How will you do this in profile software for T1 and T2. Please elaborate.

From CRA's site - Replacement property

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