Tax Tip: Defer Capital Gains

by Dean Paley on January 29, 2013

When you sell certain types of property including shares, real estate, a business or farm for a gain you may be able to defer the tax on the capital gain for up to 5 years and in in certain circumstances, 10 years.

The Income Tax Act allows you to defer a portion of your capital gain when you sell property but do not receive payment immediately. For example, assume you sell your rental building an incur capital gain. As part of the deal, you agree to have the buyer pay you over 5 years. You will be required to include a portion of the gain in your income each year but and defer the remainder.

The above example is simplistic and property care must be taken to ensure that you have sufficient cash on hand to pay the resulting tax bill each year.

We Can Help You Can Pay Less Tax

Call us today at (289) 288-1206 to email us to arrange your appointment. We provide professional income tax preparation and planning to help you keep more of your hard earned money. Our services are available in our offices or in your home.

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