Moving expense question

Tax Topics
1

I wonder if anyone could help me out regarding a moving expense question. I found an example from CRA website (post below) that is very close to my case. My question is in the example below, if I move to dwelling B for 2 years (instead of a few months in the example), could I claim the cost of buying the new home (dwelling C)? I was a tenant in dwelling B.

Here is the link and example.

Example 3
An individual who ordinarily resides in dwelling A in Saskatoon moves to Regina in order to be employed. He moves to dwelling B for a few months until he takes possession of dwelling C, also in Regina. In this situation, the facts indicate that the individual did not ordinarily reside at dwelling B before ordinarily residing at dwelling C.

The CRA considers that only one move took place, from dwelling A to dwelling C, and that it occurred in two stages. Dwelling A is considered the old residence, and dwelling C the new residence. Given that this move appears to be an eligible relocation, the expenses incurred in respect of the individual’s move from dwelling A to dwelling C may be eligible as moving expenses. None of the expenses relating to the purchase or the sale of dwelling B are eligible.

2

I think 2 years would be pushing it. Dwelling B in the example is a “temporary” residence - can you consider it temporary if you stayed there for 2 years? Perhaps due to the pandemic you might have a good argument, but be prepared to prove that to CRA. CRA questions most moving expense claims, and I doubt yours will be overlooked.

3

Thank you. Pandemic is the exact reason we did not buy the house in the year when we moved.

4

I would say pretty hard no. I can’t really see any argument that the pandemic prevented you from purchasing a home. In fact in most markets housing sales are way up. So CRA would take the position that you MOVED to dwelling B (a rental I assume).

5

One has to designate a principal residence. In other words file to get it changed from rental to PR.