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I live in Canada. I bought a house in 2010 and have been renting it to date, and have been claiming the rental income on my tax returns along with the allowable expenses.
I am thinking of selling my house in 2022. Since I have been living with my parents to date, I am asking, can I claim the rental property once sold as my principal residence and avoid capital gain taxes? Thanks..

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  • It kind of sounds like a legal question rather than finance...?
    – Musuyajin
    Commented Aug 19, 2020 at 15:39

1 Answer 1

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You might try but probably you will get caught easily.

Try to answer two questions:

  • what was your address, registered with CRA, for the last 10 years?
  • any of your tenants reported the tenancy on they tax return anytime during last 10 years?

CRA has the answers and they will validate / decline your claim automatically, no human intervention required.

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  • I think the questioner implicitly means "can I legally do this" not "will I get caught if I do this illegally". Commented Aug 19, 2020 at 15:32
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    @DJClayworth In that case the answer is, no he can't as it wasn't his principal residence. He will also need to deal with the capital gain / loss on the disposition of the house when it is sold. And he might need to prove that he has been reporting the income from the rental of the house. The exception is this: canada.ca/en/revenue-agency/services/tax/technical-information/…
    – C'est Moi
    Commented Aug 19, 2020 at 18:45

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