CANADIAN REAL ESTATE PORTFOLIO – CAPITAL GAINS OPTIMIZATION

• INVESTOR PROFILE:
• Location: Toronto, Canada
• Income: $180,000 annually
• Filing status: Married
• Current marginal tax rate: ____% (provincial + federal)
• Retirement timeline: 15 years (age 60)
• Risk tolerance: ________________________________
• PROPERTY A – PRIMARY RESIDENCE ANALYSIS:
• Purchase price (2019): $800,000
• Current fair market value: $1,100,000
• Improvements/renovations: $75,000
• Adjusted cost base: $_____ (purchase + improvements + costs)
• Potential capital gain: $_____
• Principal residence exemption: $_____ (100% if designated)
• Taxable capital gain: $_____ (should be $0 if principal residence)
• Tax owing: $_____
• Strategy recommendation: ________________________________
• PROPERTY B – RENTAL CONDO ANALYSIS:
• Purchase price (2020): $450,000
• Current fair market value: $580,000
• Adjusted cost base: $_____ (include purchase costs)
• Capital gain: $_____
• Taxable capital gain (50%): $_____
• Tax owing at marginal rate: $_____
• Annual rental income: $33,600 ($2,800 x 12)
• Hold vs sell analysis: ________________________________
• Optimal timing: ________________________________
• PROPERTY C – OTTAWA DUPLEX ANALYSIS:
• Purchase price (2018): $320,000
• Current fair market value: $425,000
• Adjusted cost base: $_____
• Capital gain: $_____
• Taxable capital gain (50%): $_____
• Tax owing at marginal rate: $_____
• Strategic considerations: ________________________________
• Timing recommendation: ________________________________
• PROPERTY D – COTTAGE ANALYSIS:
• Purchase price (2021): $650,000
• Current fair market value: $780,000
• Adjusted cost base: $_____
• Capital gain: $_____
• Taxable capital gain (50%): $_____
• Tax owing at marginal rate: $_____
• Principal residence designation option: ________________________________
• Family considerations: ________________________________
• CURRENT TAX LIABILITY SUMMARY:
• If all properties sold today:
• – Property A (principal residence): $0 tax
• – Property B (rental condo): $_____ tax
• – Property C (Ottawa duplex): $_____ tax
• – Property D (cottage): $_____ tax
• – TOTAL CURRENT TAX LIABILITY: $_____
• Impact on current year income:
• – Current employment income: $180,000
• – Total taxable capital gains: $_____
• – Total taxable income: $_____
• – Marginal tax rate impact: _____%
• RETIREMENT TIMING STRATEGY ANALYSIS:
• Scenario 1 – Sell in retirement (lower income):
• – Expected retirement income: $_____ annually
• – Marginal tax rate in retirement: _____%
• – Tax on Property B in retirement: $_____
• – Tax on Property C in retirement: $_____
• – Tax on Property D in retirement: $_____
• – Total retirement tax liability: $_____
• Tax savings by waiting: $_____
• Net present value analysis: ________________________________
• Market risk considerations: ________________________________
• PRINCIPAL RESIDENCE OPTIMIZATION:
• Current Strategy – Primary residence on main home:
• – Years owned: _____ years
• – Principal residence years: _____ years
• – Exemption available: $_____ (100% if full period)
• Alternative Strategy – Designate cottage as principal residence:
• – Cottage gain: $_____
• – Primary residence gain: $_____
• – Optimal allocation formula: ________________________________
• – Years to designate cottage: _____ years
• – Years to designate primary: _____ years
• – Total tax savings: $_____
• Family unit considerations:
• – Spouse income and ownership: ________________________________
• – Children and future ownership: ________________________________
• – One designation per family rule: ________________________________
• STAGED SALE STRATEGY:
• Year 1 Sale Plan:
• – Property to sell: ________________________________
• – Reason for timing: ________________________________
• – Tax impact: $_____
• – Marginal rate impact: _____%
• Year 2 Sale Plan:
• – Property to sell: ________________________________
• – Tax impact: $_____
• – Cumulative tax optimization: $_____
• Year 3+ Sale Plan:
• – Remaining properties: ________________________________
• – Retirement year coordination: ________________________________
• – Final tax optimization: $_____
• INCOME SPLITTING OPPORTUNITIES:
• Spouse Involvement Strategy:
• – Current spouse income: $_____
• – Spouse marginal tax rate: _____%
• – Attribution rule considerations: ________________________________
• – Legitimate transfer opportunities: ________________________________
• – Joint ownership planning: ________________________________
• Family Trust Considerations:
• – Children ages and income: ________________________________
• – Trust setup costs vs benefits: ________________________________
• – Professional advice required: ________________________________
• ADVANCED TAX STRATEGIES:
• Capital Loss Harvesting:
• – Other investments with losses: ________________________________
• – Timing of loss realization: ________________________________
• – Superficial loss rules: ________________________________
• – Net capital loss carryback opportunities: ________________________________
• Reserve for Future Proceeds:
• – Installment sale opportunities: ________________________________
• – Reserve calculation: $_____ per year
• – Income smoothing benefit: $_____
• – Risk assessment: ________________________________
• Charitable Donation Strategies:
• – Donation of appreciated property: ________________________________
• – Tax credit vs capital gains: ________________________________
• – Charitable remainder trusts: ________________________________
• – Professional setup required: ________________________________
• CASH FLOW AND FINANCING IMPACT:
• Current Portfolio Performance:
• – Total rental income: $_____ annually
• – Net operating income: $_____ (after expenses)
• – Cash-on-cash return: _____%
• – Portfolio appreciation rate: ____% annually
• Sale Proceeds Deployment:
• – After-tax proceeds: $_____
• – Reinvestment opportunities: ________________________________
• – Diversification considerations: ________________________________
• – Risk tolerance alignment: ________________________________
• PROFESSIONAL TEAM REQUIREMENTS:
• Tax Professional:
• – Qualified accountant specializing in real estate: ________________________________
• – Annual tax planning meetings: _____ times per year
• – Estate planning coordination: ________________________________
• – CRA audit support capability: ________________________________
• Legal Professional:
• – Real estate lawyer for transactions: ________________________________
• – Estate planning lawyer: ________________________________
• – Family trust specialist (if applicable): ________________________________
• Financial Advisor:
• – Portfolio optimization specialist: ________________________________
• – Retirement planning coordination: ________________________________
• – Risk management planning: ________________________________
• IMPLEMENTATION TIMELINE:
• Immediate Actions (Next 30 days):
• 1. Consult qualified tax accountant
• 2. Gather all property documentation and improvement records
• 3. ________________________________
• 4. ________________________________
• Short-term Actions (3-6 months):
• 1. Finalize principal residence designation strategy
• 2. ________________________________
• 3. ________________________________
• 4. ________________________________
• Long-term Actions (1-3 years):
• 1. Execute staged sale strategy
• 2. ________________________________
• 3. ________________________________
• 4. ________________________________
• MONITORING AND REVIEW PROCESS:
• Annual Review Schedule:
• – Property valuations: _____ frequency
• – Tax law changes: _____ frequency
• – Income and tax bracket analysis: _____ frequency
• – Strategy adjustment criteria: ________________________________
• Key Metrics to Track:
• – Portfolio appreciation rate: ____% target
• – Net rental yield: ____% target
• – Effective tax rate: ____% target
• – Retirement income replacement: ____% target
• RISK MANAGEMENT:
• Market Risk Factors:
• – Toronto real estate market volatility: ________________________________
• – Interest rate impact on property values: ________________________________
• – Rental market strength: ________________________________
• – Timing risk for sales: ________________________________
• Tax Risk Factors:
• – Future tax law changes: ________________________________
• – CRA audit risk: ________________________________
• – Documentation adequacy: ________________________________
• – Professional advice compliance: ________________________________
• FINAL RECOMMENDATION SUMMARY:
• Optimal Strategy:
• Based on analysis, the recommended approach is:
• 1. ________________________________
• 2. ________________________________
• 3. ________________________________
• 4. ________________________________
• 5. ________________________________
• Expected Outcomes:
• – Total tax savings: $_____
• – Cash flow improvement: $_____
• – Risk reduction: ________________________________
• – Retirement readiness: ________________________________
• Professional Consultation Priority:
• – IMMEDIATE: Tax accountant consultation required
• – HIGH: Estate planning lawyer review
• – MEDIUM: Financial advisor portfolio review
• – ONGOING: Annual strategy review and updates
• DISCLAIMER:
• This analysis is for educational purposes based on 2025 tax laws.
• Tax laws change frequently and professional advice is essential.
• All strategies require professional tax and legal consultation.
• Individual circumstances may significantly impact outcomes.