There are various ways of reducing the capital gain when selling your property. No matter the way you choose, the capital gain that can ensue from the sale of a property is one of the most important things to most taxpayers because of the high amount of money involved.
Here are a few ways to reduce your capital gain, thus reducing the tax payable.
Make sure that you include all your expenses of a capital nature when selling your property, such as the furniture, major renovations, a new garage, and any other modifications that add value to your property.
You can increase the cost of your property by considering all the fees engaged during the sale, which are the fees you paid when you purchased the property. The property tax, the land transfer tax, the fees for a home inspection, etc. These fees will increase the cost of your property, thus reducing the capital gain.
Add the major renovations which were not deducted on your income tax return.
Building Acquired Before 1994
On the Revenu Québec website, verify if you are eligible for an exception of up to $100 000 if you purchased the property before 1994.
Deferral of Gain
It is also possible to defer a portion of this capital gain for up to five years, if there is a balance of the sale price receivable at the end of the year.
If you want to learn more about how to reduce your capital gain, I invite you to visit Revenu Québec’s website. You will find several tips that may apply to your financial situation.