Category Archives: Canada

CRA goes after Reno flips

One way to make money without paying taxes is to live in a home you are renovating to sell so you can claim the principal residence tax exemption. Of course if you do this as a way to make money you are actually operating a business and you owe those taxes anyways, either as capital gains or income taxes.

The CRA is going after people using this loophole to illegally avoid paying taxes and are using third party data to find them. If you are thinking of Reno flips without considering the tax bill, this might not be your best money making strategy.

Millionaires protest exorbitant unfair tax

From justme: people that own homes worth more that 3 million dollars may have to pay an extra housing tax. For a 3.5 million dollar property that could cost as much as $50 to $100 per month.

“Owners of multi-million dollar homes are probably not going to endear themselves to the public by pleading financial hardship. Nevertheless, more than 100 Vancouver residents gathered in a park last week to protest a surtax introduced by the provincial NDP government on homes worth more than $3 million. They wielded signs claiming the government “wants to confiscate your hard-earned home savings!” The tax, they said, is “unfair,” “exorbitant” and “predatory.”

Read more here.

Don’t forget to pay your condo flipping taxes

Just a reminder, flipping condos as a money making venture means you have to pay taxes on that income and the CRA is going after those who don’t report condo flipping profit.

From April 2015 to December 2017, the CRA audited 4,951 files in British Columbia and assessed $140.0 million as a result of these audits.

The penalties for non-compliance are harsh.

“The CRA will apply a penalty equal to 50% of the additional tax payable if a taxpayer knowingly makes a false statement when filing a return,” the CRA says. “During the period of April 2015 to December 2017, the CRA applied 1,254 penalties, totaling $38.6 million. The highest penalty was almost $2.5 million.”

Read the full article here.

BC seeks Ottawa support on money laundering

The BC Attorney General is headed to Ottawa to ask for more support to crack down on money laundering.

He plans to outline the challenges here in BC before the federal Finance Committee.

“The issues that we’re grappling with around real estate and casinos, and the seriousness of the impact that gang violence has when these gangs are able to launder money,” he outlines.

“The federal government has a huge role to play in supporting British Columbia in our fight against money laundering. The role really includes key actors like Fintrac, which is the anti-money laundering agency that receives all the reports from casinos, realtors, [and] notaries,” says Eby.

He believes drug dealers and other criminals have been spending millions of dollars in illegally gained cash at local casinos and then getting clean bills back in return. He has said the issue is so prevalent here, experts call it “the Vancouver Model.”

He’s pushing for more support and coordination to clamp down on money laundering. He also wants more public accountability.

Read the full article here.

Toronto prices drop 12% as sales plunge

Toronto is becoming a better and better investment as prices fall, you just need to buy when they’ve stopped falling. Right now they’re seeing quite a price drop.

Re-sale home prices in the Toronto region dropped 12.4 per cent, or about $110,000, year over year in February.

The average price fell to $767,818, from $875,983 for all housing categories, including detached, semi-detached, town homes and condos.

The number of sales also plunged nearly 35 per cent last month compared to Feburary 2017 — to 5,175 transactions from last year’s record 7,955, according to the latest statistics from the Toronto Real Estate Board (TREB) on Tuesday.

Read the full article here.