I’m the executor for an estranged family member who passed away. I’m looking at the potential taxes for next year. There istwo peices of property I have to account for, a cottage and a house. I’ve found paperwork about both properties like purchase price and dates. I’ll be using the cottage as principal residence and capital gains on the house as the gain on cottage is much larger. The problem I have is the cottage was owned since the mid 90s and house was owned since mid 2000s. I have no information if this family member had another principal residence in the early early years of owning the cottage. I’ve heard through family that they were renting at this time but no one knows for sure. Is there a way to find this information or could I get in trouble if I claim pr for the entire cottage ownership and they actually owned property at the same time?
Prior to 2017, nobody had to declare or designate their principal residence when sold (or upon death). So, if your deceased client had owned another principal residence between the 1990s and 2000s, CRA would have no record of it, unless your client had filed a 45(2) at some point (this is the election to maintain the status as principal residence on a property for up to 4 years after you move out).