Changes to the Capital Gains Tax: What You Need to Know
Proposed Changes Include Lifetime Exemption Boost for Business Owners
The federal government has announced proposed changes to capital gains taxation in Budget 2024. These changes aim to make commercial real estate less attractive and increase tax revenue.
Key Changes in Budget 2024
- Boost to the lifetime capital gains exemption for business owners
- Taxation of all capital gains earned by corporations and trusts at a two-thirds rate
- Increased capital gains inclusion rate from 50% to 66.67%, effective June 25, 2024
Impact on Commercial Real Estate
The proposed changes have raised concerns in the commercial real estate sector, as they could make it less financially advantageous to invest in this asset class.
Effective Date
The increased capital gains inclusion rate will take effect on June 25, 2024, slightly more than two months after its announcement.
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