Have you heard about the capital gains tax changes Canada 2024 is bringing in—and wondered how it might affect you?
If you’re thinking about selling a second home, rental property, or inherited real estate in Ontario, the new rules could seriously impact how much tax you owe.
These updates aren’t just numbers on a page—they could change the way you plan, sell, and profit from your property.
That’s why understanding the fine print now is so important.
In this blog, we will talk about:
- The real impact of tax changes on home sales Ontario homeowners need to know
- What to expect when selling property and capital gains tax Ontario laws apply
- Smart ways to reduce tax implications for Ontario home sellers while navigating capital gains tax in real estate
Let’s break it down—so you’re prepared, not surprised.
What’s Changing with Capital Gains Tax in Canada in 2024?
Capital gains tax isn’t new—but capital gains tax changes Canada 2024 will reshape the way many Ontario homeowners think about selling property.
Let’s start with the basics.
Capital gains tax applies when you sell an asset for more than you paid for it. In real estate, this usually affects non-primary residences like rental properties, cottages, investment units, or inherited homes.
Under the previous rules, 50% of your gain was added to your taxable income. Starting in 2024, that inclusion rate is rising to 66.67% for profits over a certain threshold, currently proposed at $250,000.
Here’s the catch: this change doesn’t just impact investors with huge portfolios. It can affect everyday homeowners who’ve seen significant appreciation in a property they’ve held for years.
If you’re selling a second property in Ontario, it’s time to re-evaluate your numbers, because what used to be a manageable tax bill could now feel a lot heavier.
Tax Implications for Ontario Home Sellers
Let’s get specific—because this isn’t just a policy change on paper. The tax implications for Ontario home sellers are very real, especially for those who’ve built equity over time.
Picture this: you bought a rental condo 10 years ago for $300,000. Today, you’re selling it for $600,000. That’s a capital gain of $300,000. Under the old rule, you’d pay tax on $150,000 of that gain (50%).
Now, with the updated inclusion rate, you’ll pay tax on $166,675 of that same profit—an increase that eats into your net proceeds.
This change applies to:
- Second homes or vacation properties
- Rental or income properties
- Inherited properties that are not your primary residence
- Flipped properties held for appreciation
What’s even more frustrating?
The increase doesn’t mean you did anything wrong—it just means the tax structure moved, and you’ve got to adjust.
If you’re selling property and capital gains tax Ontario laws apply to your sale, this is a critical moment to rethink your timing, structure, and post-sale plan.
Navigating Capital Gains Tax in Real Estate: What You Can Do
You can’t avoid the tax entirely, but navigating capital gains tax in real estate isn’t just about writing a cheque and moving on. It’s about planning.
Start with your adjusted cost base (ACB)—that’s not just your purchase price. It also includes capital improvements (like major renovations) and closing costs when you bought the property. The higher your ACB, the lower your gain.
So pull those records together. Even things like replacing a roof or adding a deck could reduce your taxable amount.
Next, track eligible deductions. Did you pay realtor commissions, legal fees, or moving costs related to the sale? Those can help reduce your gain as well.
Timing can also play a big role. Depending on when you sell—and how much gain you’re realizing—you may be able to stay under the new inclusion threshold. In some cases, delaying the sale or splitting it across tax years can make a real difference.
Most importantly: talk to a tax advisor before you list. Every situation is unique, and the rules are layered.
A little planning up front could save you thousands.
Strategies to Minimize Your Capital Gains Liability
Yes, the tax bill is rising—but you’re not without options. There are legitimate, CRA-compliant strategies that can help reduce how much tax you owe.
Let’s walk through a few:
Stagger your sales
If you own more than one property, consider spreading sales across different years. This avoids triggering a massive gain in a single tax return and helps you keep more income in lower brackets.
Explore joint ownership opportunities
The capital gain is typically split if you co-own a property with a spouse or family member. This can be helpful if only one of you is bumping up against a higher tax bracket.
Use the Lifetime Capital Gains Exemption (LCGE)
While the LCGE typically applies to small business shares and qualified farm or fishing property, it’s worth checking if any portion of your sale might qualify under special conditions. It’s rare, but not impossible.
Reinvest with purpose
If you’re reinvesting proceeds into another property—especially to generate income—some structures may help you defer or offset gains, particularly if you’re using vendor take-back (VTB) mortgages or installment sale methods.
Structure the deal carefully
Creative deal structures like phased payments or partial sales can reduce the immediate tax hit and give you more flexibility in managing the gain.
The key takeaway here?
How you sell matters just as much as when you sell.
Don’t rush to close the deal without first checking how your decision will affect your next tax return.
How Friendly Home Buyers Can Help Ontario Sellers in This New Tax Environment?
Taxes are personal, but real estate is emotional too. When both collide, things can get overwhelming fast.
At Friendly Home Buyers, we understand the impact of tax changes on home sales Ontario homeowners are facing in 2024. We’re not just here to make an offer—we’re here to be a knowledgeable, low-pressure resource when you’re figuring out your next step.
Here’s how we can help:
- Flexible closing dates that give you more control over the timing of your capital gain
- Off-market transactions that let you avoid realtor fees and reduce your overall costs
- Private sales that are fast and predictable—no staging, no open houses, no stress
- Clear communication around what your sale could mean for your tax situation (we work closely with your accountant or advisor if needed)
If you’re selling a rental, a second home, or an inherited property—and feeling unsure how this all plays out—we’ll walk through it with you.
We’ve helped hundreds of Ontario sellers navigate complex financial decisions with empathy and clarity.
You don’t have to go it alone.
Wrapping It Up
The capital gains tax changes Canada 2024 brings will make an already complicated process more expensive for many Ontario homeowners. But knowing what’s changing—and planning around it—can help you protect your profits and avoid unnecessary surprises.
If you’re preparing to sell, don’t wait until the closing paperwork lands in your lap to think about taxes. From understanding the tax implications for Ontario home sellers to exploring smart ways of navigating capital gains tax in real estate, the right move now could save you thousands later. And if you’re looking for a fast, fair, and private way to sell your property without getting buried in tax confusion, Friendly Home Buyers is here to help.