How did you spend your Thanksgiving this past weekend?
We spent the Saturday with a bunch of Superheroes delivering food baskets to 300 families at the Hamilton Basket Brigade .
Delivering to 300 families was no easy job. Normally, Erwin and I would have taken the kids in separate cars and delivered to the same families. We were short on drivers so we had to split up to help.
This was the first time ever that I delivered baskets on my own (with the kids and a teenager’s help).
All the recipients are grateful for what they received.
What struck me the most was that, although we considered these families as the less fortunate ones at this moment, the kids are still having fun with their siblings riding bikes in the neighborhood.
They still had their smiles on.
They are still enjoying their lives at whatever condition it is.
Being an entrepreneur and a mom is no different, I have ups and downs in my business. I don’t get overly excited when it’s great. I shouldn’t beat myself up excessively when it doesn’t go my way.
I am grateful that we are in the position to help them out today. I am also grateful to learn from them, live in the moment and enjoy life, regardless of where you are.
Happy belated Thanksgiving to all of you.
Now onto this week’s topic.
A couple week’s ago, I talked about the tax impact on a paper flipping deal.
When I attended recent professional development courses, one tax lawyer had specifically mentioned that CRA had reached out to developers and builders demanding the list of investors who had sold their units before closing.
I wasn’t particularly surprised when the headline “court orders developer to reveal condo-flipper info” came out.
Most developers are happy to comply. The only possible issue would be concerns over privacy law.
Unless CRA can seek court order approval, builders and developers cannot breach privacy law to provide information to CRA.
Under the current system, when an investor purchases a new build, they can sell the new build before closing to a second investor.
This process can be repeated a few times before closing. Only the ultimate purchaser who closes the deal would appear on the Land Registry.
CRA has only access to the Land Registry and hence unable to track down these people who are flipping properties on paper.
This Court Order approval is the first of many to come so CRA can better handle who has made money off these deals.
For real estate investors who were using the loopholes, CRA is working its way around the system to go after you.
Until next time, happy Canadian Real Estate Investing.
Cherry Chan, CPA, CA
Your Real Estate Accountant