Are there any capital gains tax implications?
A. The gain on the sale of a principal residence may be tax exempt if the residence meets certain requirements. There is an exemption calculation to determine the exempt portion of the gain on the disposition of a principal residence. The formula calculates the numerator as one plus the number of taxation years in which the property is designated as a principal residence. The denominator is calculated on the period of ownership. When taxable Canadian property (which includes a principal residence) is sold by a non-resident of Canada, there is a requirement on the part of the purchaser to withhold tax of 25% of gross proceeds and remit these funds to the CRA. A clearance certificate can be obtained from the CRA to have 25% tax withheld on the capital gain of the property. If you decide to sell your principal residence you should ensure that your legal counsel files this form on your behalf. Q. I have a number of Canadian company shares. Will I remain liable to Canadian capital gains tax
