The original came from CTV.
I guess the biggest part of the tax bill would be from the property from the unrealized capital gains. If you own 2 properties. One is capital gains free (the one you live in). So you sell that property (this is capital gains free), and go live in your other secondary property. Now from the time you bought the second property to the time you moved into that property, you have to pay capital gains on that second property (accordingly to the value worth of the property when you moved into second property - using tax assessments and value of same types of property sold in the area too). You will pay for this after you sell the second property. So from the initial price to the move in price, is taxable at capital gains; only from the moving in point to the selling point is the house now capital gains free. I don't know when this sneaky rule got applied to capital gains, but it is a hidden windfall for the government and not so for the owner.
This rule alone is very preventive of people investing in a secondary property or cabin in the woods. Considering since about 2000 house prices have at least tripled and in some cases quadrupled, the capital gains tax on a secondary property is staggering.....
Lets not forget about people claiming office space in their house for bussiness purposes. Yes capital gains will apply against your house for the portion of you office space divided by house space. Again the rising of house prices affects the capital gains you pay on your assumed capital gains free house....
Now for the RRSP- https://www.canada.ca/en/revenue-ag...rates-individuals-current-previous-years.html
anything over 254,000.00 is taxed at 33%. I will assume that the couple saved and had 500,000 to 1.5 million already in RRSPs. That is 165,000 to 495,000 in taxes...
So its a combination of both taxes that hit hard in a very short amount of time for the parents tax situation.
The tax free account is a better saving option than RRSPs. Its just that alot of people from the 1980s went into RRSPs, and to make them work still had to contribute to them for retirement.
RRSP should be withdrawn when you have lower income, so as to not go into higher tax brackets (3 or 4th level of taxations). But if you need a very large sum like 100000, you will pay with the extra tax brackets (so expect 33% tax ).
So what I can see for the near future is the government collecting alot of revenue from the dying baby boomers.
Then there is any secondary property that will have to pay capital gains.
Then there is the bussiness deduction in your home busssiness....
In the future I can see the family farm (3rd to 5th generation) having to be sold to pay for the perceived capital gains.....
Everything is designed so that everything comes to a head when you die. Generational wealth will be wiped out!!!!!
I guess the biggest part of the tax bill would be from the property from the unrealized capital gains. If you own 2 properties. One is capital gains free (the one you live in). So you sell that property (this is capital gains free), and go live in your other secondary property. Now from the time you bought the second property to the time you moved into that property, you have to pay capital gains on that second property (accordingly to the value worth of the property when you moved into second property - using tax assessments and value of same types of property sold in the area too). You will pay for this after you sell the second property. So from the initial price to the move in price, is taxable at capital gains; only from the moving in point to the selling point is the house now capital gains free. I don't know when this sneaky rule got applied to capital gains, but it is a hidden windfall for the government and not so for the owner.
This rule alone is very preventive of people investing in a secondary property or cabin in the woods. Considering since about 2000 house prices have at least tripled and in some cases quadrupled, the capital gains tax on a secondary property is staggering.....
Lets not forget about people claiming office space in their house for bussiness purposes. Yes capital gains will apply against your house for the portion of you office space divided by house space. Again the rising of house prices affects the capital gains you pay on your assumed capital gains free house....
Now for the RRSP- https://www.canada.ca/en/revenue-ag...rates-individuals-current-previous-years.html
anything over 254,000.00 is taxed at 33%. I will assume that the couple saved and had 500,000 to 1.5 million already in RRSPs. That is 165,000 to 495,000 in taxes...
So its a combination of both taxes that hit hard in a very short amount of time for the parents tax situation.
The tax free account is a better saving option than RRSPs. Its just that alot of people from the 1980s went into RRSPs, and to make them work still had to contribute to them for retirement.
RRSP should be withdrawn when you have lower income, so as to not go into higher tax brackets (3 or 4th level of taxations). But if you need a very large sum like 100000, you will pay with the extra tax brackets (so expect 33% tax ).
So what I can see for the near future is the government collecting alot of revenue from the dying baby boomers.
Then there is any secondary property that will have to pay capital gains.
Then there is the bussiness deduction in your home busssiness....
In the future I can see the family farm (3rd to 5th generation) having to be sold to pay for the perceived capital gains.....
Everything is designed so that everything comes to a head when you die. Generational wealth will be wiped out!!!!!
