In 2018, my father passed away. My mother then transferred 50 % of her principal residence to me as a gift. I still live with her and i am over 18 years old. On her 2018 tax return, my mother forgot to file the principal residence exemption designation forms.
Question 1: Can CRA REFUSE to accept any late filling of the principal residence designation (plus late filling penalty fees) and demand my mother pay the capital gains tax immediately (on her share of the house) despite the house been her principal residence ? She does not have 100k to pay the capital gains tax.
Question 2: My mother did file the principal residence designation forms for a deceased individual on my father's last tax return (2018). CRA says a family unit (the taxpayer, along with her spouse) is entitled to one principal residence exemption per year. Does this mean my mother cannot file anyways her own principal residence designation in the same year ?
