Free tool
Capital gains calculator
Estimate the capital gains tax on your property sale. Includes the principal residence exemption and adjusted cost base.
Renovations, additions — not regular maintenance
Fully exempt
$0 tax owing
Your principal residence exemption covers the full gain. You must still report the sale.
Total capital gain
$325,000
Adjusted cost base
$650,000
Purchase price + improvements
Understanding capital gains tax in Canada
Key rules for selling real estate in BC
Principal residence exemption
Your principal residence is generally exempt from capital gains tax in Canada. You must have designated the property as your principal residence for all years you owned it. Since 2016, you must report the sale on your tax return even if the gain is fully exempt.
How capital gains tax works
A capital gain occurs when you sell your property for more than you paid (plus improvements and selling costs). In Canada, only 50% of capital gains are taxable, added to your income for the year of the sale.
Adjusted cost base
Track all eligible capital improvements (renovations, additions) to increase your adjusted cost base and reduce your taxable gain. Regular maintenance and minor repairs don't qualify — keep receipts for major work.
Business or rental use
If you've used part of your home for business or rental income, that portion may not qualify for the principal residence exemption. If you converted your home to a rental, you can elect to treat it as your principal residence for up to four additional years.
Reducing your capital gains tax
Legitimate strategies include tracking all eligible improvements to increase your cost base, timing your sale strategically, and using capital losses from other investments to offset gains. Consult a tax professional for your specific situation.
This calculator provides estimates for educational purposes only. Always consult with a qualified tax professional before making decisions. Tax rates and rules may change.
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