Why sign in to the Community?

  • Submit a question
  • Check your notifications
Sign in to the Community or Sign in to TurboTax and start working on your taxes
New Member
posted Apr 28, 2022 8:31:53 PM

Does the outlays and expenses part also include the buyer's real estate commission?

0 1 376
1 Replies
Level 4
May 2, 2022 12:42:12 PM

According to the Canada Revenue Agency (CRA), the calculation of capital gain/loss is:

Proceeds of Disposition - (Adjusted Cost Base + Outlays and Expenses) = Capital Gain/Loss

 

The definitions of the 3 goes as follows:

Proceeds of Disposition: Usually the amount you received or will receive for your property. In most cases, it refers to the sale price of the property. This could also include compensation you received for property that has been destroyed, expropriated, or stolen.

Adjusted Cost Base:

Usually the cost of a property plus any expenses to acquire it, such as commissions and legal fees.

The cost of a capital property is its actual or deemed cost, depending on the type of property and how you acquired it. It also includes capital expenditures, such as the cost of additions and improvements to the property. You cannot add current expenses, such as maintenance and repair costs, to the cost base of a property.

Outlays and Expenses:

Amounts that you incurred to sell a capital property. These types of expenses include fixing-up expenses, finders' fees, commissions, brokers' fees, surveyors' fees, legal fees, transfer taxes, and advertising costs.

For more information, check out: Canada Revenue Agency (CRA) - Capital Gain/Losses

 

As the Canada Revenue Agency (CRA) recognizes Outlays and Expenses as commissions you may add it in your Capital Gain/Loss transaction.

 

Thank you for choosing TurboTax.