As per CRA when you sell your home or when you are considered to have sold it, usually you do not have to pay tax on any gain from the sale because of the principal residence exemption. This is the case if the property was solely your principal residence for every year you owned it.
Therefore, with your case, you will not be taxed when you sell your property due to the principal residence exemption.
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 more information, please see:
- Principal residence and other real estate
- Disposing of your principal residence
- Reporting the Sale of Your Principal Residence
- Selling Your Canadian Principal Residence
- Capital Gains and Selling Your Home
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