Ask a Planner

By Jason Heath, CFP on March 31, 2025
Estimated reading time: 4 minutes

By Jason Heath, CFP on March 31, 2025
Estimated reading time: 4 minutes

Can you retroactively change the valuation of a rental property before selling it to reduce capital gains tax in Canada?

I have a query about fair market value. When I moved to Canada in 2011, I recorded a fair market value for my property in London, England. This valuation was done by a realtor and was used to claim CCA allowances on my income tax while I was renting it out.

Now that I am planning to sell the property and generate a capital gain versus the fair value of property as of 2011, can I get a more precise professional valuation of the property as of 2011, as this may give a more advantageous (higher) value to reduce capital gains tax?

—Carl

When you sell a rental property, Carl, you need to calculate the net proceeds and the adjusted cost base (ACB) to determine the difference—the capital gain—and the potential tax payable.

The proceeds are easy enough to determine based on the selling price and any selling costs, but the ACB can take a bit more work. You start with the acquisition cost, including closing costs, and add any renovations over the years. However, for someone who immigrates to Canada, the calculation is a........

© MoneySense