Change of percentage of co-ownership

sandra

Inspired Forum Member
Registered
Sep 4, 2007
41
1
8
#1
Hi all,
I and my sister co-owner of rental property, Last year we decide to change percentage of ownership. Let says before 50/50. Now 70/30.
Are there any procedure to let CRA know when I file income tax.
Another question is how often properties co-owner allow to change percentage of ownership.
Thanks
Sandra
 
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CorySperle

Senior Forum Member
REIN Member
Sep 1, 2010
624
335
63
Edmonton
#3
This is unusual and can be expensive and complex and your likely far better off with one of you owning the property outright and taking out the other via refinance. The simplest solution of course is to sell said property, split the gains and move on.

For example you need to know value at purchase, and value now so an appraisal is required and it's quite easy to complicate your relationship splitting hairs.
 
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ThomasBeyer

Senior Forum Member
REIN Member
#4
This is unusual and can be expensive and complex and your likely far better off with one of you owning the property outright and taking out the other via refinance. The simplest solution of course is to sell said property, split the gains and move on.

For example you need to know value at purchase, and value now so an appraisal is required and it's quite easy to complicate your relationship splitting hairs.
To sell or to refi ?

The agony and the ecstasy !! Analyzed here: http://blog.reincanada.com/sell-or-refinance-the-agony-and-the-ecstasy

Refi and buyout of partner usually preferred IF enough $s can be had from refi and enough cash flow. Is this the case here?


Thomas Beyer, Asset Manager, Investor, Community Improver, Author, Father, Mentor www.prestprop.com
 
Last edited:

Matt Crowley

Senior Forum Member
Registered
Dec 14, 2013
795
293
63
Edmonton
#5
Not a big deal to split the income or to change the split. Go ahead and adjust as often as you want. (No limits on change of ownership interest in the public markets).

Hopefully you set it up as a partnership and not a corporation? Much easier structure for small investments.

There can be a trailing tax liability or gift tax potentially due. Depends on fair value vs. adjusted cost basis. But if you are at a loss, you are golden (except you lost money).