Capital Gain tax

[maica]

Just wondering if anyone know about this situation regarding capital gain tax.
We have a house #1 that we lived in, however, we bought another house #2 and let our parents live in the #1 house for free. I guess we cannot claim any expenses since there`s no income. However, the question that we have is that do we have to pay capital gain tax when we sell the house in the future when our parents pass away?

Thanks,
maica

 

[jcab256]

QUOTE (maica @ May 27 2009, 08:25 AM) However, the question that we have is that do we have to pay capital gain tax when we sell the house in the future when our parents pass away?

Yes you will, but you will only pay a percentage of it based on the time that house#1 was NOT your principle residence.

I believe the CRA website has the calcs for this.