How to calculate a capital gain on your cottage or investment property
Step-by-step approach to determine ACB, proceeds, and taxable gain when selling a cottage.
Summary of Tim Cestnick — The Globe and Mail (Tax Matters). The Globe and Mail. Read the original.
Summaries are for educational purposes. All rights to original articles remain with the publisher.
What it covers
This piece lays out a methodical way to calculate a capital gain on a cottage. Start with the original purchase price, add eligible acquisition costs and capital improvements, then subtract selling expenses to arrive at the gain.
Cestnick highlights common errors, including mixing personal and rental use without tracking, misclassifying repairs versus improvements, and losing invoices over time.
Why it matters
An incomplete or undocumented ACB increases the apparent gain and the resulting tax. CRA expects a defensible file for significant properties.
Cottagr takeaway
Use Cottagr as a digital ACB binder. Store invoices, categorize each expense, and maintain a simple ACB summary so you are never reconstructing decades of history under pressure.
Summary of Tim Cestnick — The Globe and Mail (Tax Matters) — The Globe and Mail