Fiscal and Financial Planning Guide 2024-2025

Owners > Quick resale of real estate property (real estate flip)

This new measure applies to real estate sold after January 1, 2023 (e.g. residence, cottage, income property).

Under this new rule, the profit on resale of a real estate property that has been owned for a period of less than one year will be deemed to be business income.

Thus, if a residence or cottage owned for less than one year is sold, the profit will be taxable as business income. The principal residence capital gain exemption cannot be claimed.

Similarly, the profit on the sale of an rental property owned for less than one year cannot be considered as a capital gain (generally taxed at 25% of the gain), but rather as business income.

There are several exceptions to this rule. For example, if the property is sold following divorce, death or insolvency.

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