Do we need to declare a "sale" of our principal residence? We bought a home with a basement rental suite, and have been renting it.

[ayseleren18]

Thank you for choosing TurboTax,

As per CRA, if you sold your property in 2020 and it was your principal residence you have to report the sale and designate the property on Schedule 3, Capital Gains (or Losses). In addition, you also have to complete Form T2091(IND), Designation of a Property as a Principal Residence by an Individual (Other Than a P.... Complete only page 1 of Form T2091 if the property you sold was your principal residence for all the years you owned it, or for all years except one year, being the year in which you replaced your principal residence.

For the sale of a principal residence in 2016 and subsequent years, the CRA will only allow the principal residence exemption if you report the disposition and designation of your principal residence on your income tax and benefit return. If you forget to make this designation in the year of the disposition, it is very important to ask the CRA to amend your income tax return for that year. The CRA will be able to accept a late designation in certain circumstances, but a penalty may apply.

Please visit our TurboTax article on Reporting the Sale of Your Principal Residence to learn more about reporting the sale of your principal residence.