Looking to cheat on your real estate transaction taxes? Bad news, the CRA has decided it doesn’t want you to and is coming after real estate tax cheats.
From April 2015 to March 2017, the CRA audits of real estate transactions resulted in more than $329.4 million in assessed income that had not been reported. During this time, the CRA applied over $17 million in penalties, primarily associated with Canada’s two major real estate markets in Toronto and Vancouver.
Canadians work hard for their money and the Government of Canada recognizes that many families count their principal residence as both their home and most valued asset. The CRA will continue to strengthen relationships with key partners such as provinces, territories, and municipalities to further expand, obtain, and exchange information on real estate transactions, thereby enhancing the CRA’s ability to combat tax evasion and avoidance.
17 million in penalties? That’s almost enough to buy a fixer-upper on the north shore!
These may not actually count as ‘secrets’, but over at the Tyee they have a list of 9 things the real estate industry doesn’t want you to know:
You’ve heard it a million times. The reason so few of us can afford Vancouver is because there aren’t enough new homes being built. This is the version of reality that real estate industry leaders and their political allies want us to believe.
But an investigation of the industry by The Tyee has revealed reality to be much more complex. Over the past six months I spoke at length with financial analysts, economists, industry consultants, realtors and many others to learn the true causes of Vancouver’s housing crisis and who is profiting from it. They were in broad agreement that real estate is at the centre of a massive realignment between our society’s rich and poor — and one that few leaders in the industry seem willing to publicly acknowledge.
About half of the items on their list have to do with the class divide and the disappearing middle class.
Read the full article here.
Southseacompany pointed out this article where Bank of Canada governor Stephen Poloz is reported to have said that low interest rates have done their job.
So what exactly was the job of low interest rates?
Three years ago the BOC was issuing warnings that real estate in Canada was as much as 30% overvalued in some markets and posed a threat to the financial system.
How’s that concern looking these days ?
The Bank of Canada is still worried about housing debt levels in Canada and joins the OECD in expressing that concern:
The two biggest concerns on the bank’s radar are also intertwined. It said the growth in mortgage lending in Toronto and Vancouver has largely fuelled an increase in Canada’s overall household indebtedness since the bank’s last review six months ago.
“Highly indebted households have less flexibility to deal with sudden changes in their income,” said the bank.
“As the number of these households grows, it is more likely that adverse economic shocks to households would significantly affect the economy and the financial system.”
The document was released as concerns about the Canadian real estate market — domestically and from abroad — continue to pile up.
Read the full article over at the Financial Post.
Canada’s economy is booming, expanding at a 3.7% annual rate in the first quarter. And yet…
Meanwhile, in a year when stocks are rising everywhere, Canada’s benchmark index is the second-worst-performer in the developed world after Israel, according to Bloomberg data. It’s a similar story in currency and bond markets.
The performance underscores how, even with the improving economic performance, caution prevails. Investors remain concerned about geopolitical risks such as U.S. trade protectionism, the outlook for oil prices and a housing market that some analysts say may be on the verge of a correction.
“It is a tad curious to say the least that the Canadian economy arguably has been one of the bigger pleasant surprises in 2017 and meanwhile the equity market has done a belly flop,” said Doug Porter, chief economist at Bank of Montreal, who highlighted the disconnect between Canadian growth and market performance in a May 26 note.
Energy shares are down 10 percent year-to-date, while fears about contagion from a run on deposits at troubled mortgage lender Home Capital Group Inc. have weighed on financial shares, which are down 1.2 percent.
Read the full article over at Bloomberg.