RSM324H1 Chapter 8: CHAPTER 8-5
15 Feb 2017
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Chapter 8 gains and losses on the disposition of capital property capital gains. Voluntary and involuntary dispositions: special treatment is provided for the recognition of capital gains on the disposition of real estate (land and buildings) that is used to conduct a business. The replacement property must be used for a similar purpose as the original property: the capital gain that would normally have been recognized is used instead to reduce the. Acb of the replacement property acquired; in this way, it is deferred until the replacement property is sold without being similarly replaced. Similar treatment is available for the recapture of cca: this exception does not apply to real estate that is used to earn property income from rentals. Nor does it apply to personal-use real estate: a similar treatment applies to property that has been lost, stolen, destroyed, or expropriated and for which compensation has been received.
