Do I pay tax when I sell my house in Quebec?
Key facts
- Principal residence sales must be reported starting with the 2016 tax year.
- Schedule 3 records the year of acquisition, proceeds of disposition and a property description.
- Form T2091(IND) is also required if the property was not your principal residence every year.
- A late designation may be accepted in some circumstances; a penalty may apply.
- Renting part of the home can result in a change in use.
Selling costs and proceeds at the notary
The principal residence exemption and reporting
If the home was your principal residence every year you owned it, the gain is exempt. The CRA allows the exemption only if the sale and designation are reported on your tax return.
Schedule 3 and Form T2091(IND)
Since the 2016 tax year, report the year of acquisition, proceeds of disposition and a description of the property on Schedule 3 (Capital Gains).
Form T2091(IND) is also required if the property was not your principal residence every year you owned it. If it was your principal residence for all years, or all but one year, only page 1 is completed.
When part of the home earns income
The whole property keeps its principal residence status only if the income use is secondary to residential use, there is no structural change, and no capital cost allowance is claimed.
Otherwise, the proceeds of disposition and adjusted cost base are split on a reasonable basis, for example square metres or number of rooms.
Converting part of the home to a rental
Converting part of a home to a rental is a change in use. It is treated as a deemed disposition and reported in the year of the change.
If you forgot to report the sale
You can ask the CRA to amend your return. A late designation may be accepted in some circumstances and a penalty may apply: the lesser of $8,000 or $100 for each complete month from the original due date to the request.
Talk to an accountant
Thomas Lymburner is a real estate agent (broker), not an accountant. Talk to an accountant about reporting, principal residence designation or a change in use.
The Québec side: Revenu Québec
According to Revenu Québec (page Selling your property, last update shown: October 5, 2023), you generally must report the capital gain (or loss) from selling a home, even if it was your principal residence; generally half of a capital gain is taxable, and a capital loss on your home is not deductible.
To claim the principal residence exemption in Québec, complete the form Designation of a property as a principal residence (TP-274), check box 109 in Part A of Schedule G, and attach both to the tax return for the year of sale. Not sending the TP-274 can lead to a penalty of $100 per month, up to $5,000.
Since 2023, selling a residential property held fewer than 365 consecutive days, without a justifying life event, is treated as a quick resale; Revenu Québec explains this on a separate page.
Confirm your situation with an accountant or Revenu Québec. General information only.
Frequently asked questions
Not on the gain if it was your principal residence every year you owned it. You must still report the sale and designation for the CRA to allow the exemption.
Yes, starting with the 2016 tax year. Schedule 3 records the year of acquisition, proceeds of disposition and a property description; T2091(IND) is also required if it was not your principal residence every year. If it was your principal residence for all years, or all but one, only page 1 is completed.
The whole property keeps its principal residence status only if the income use is secondary, there is no structural change and no capital cost allowance is claimed. Otherwise, proceeds and adjusted cost base are split reasonably. Converting part to a rental is a change in use and deemed disposition reported in the year of the change; talk to an accountant.
Ask the CRA to amend your return. A late designation may be accepted in some circumstances; a penalty may apply of the lesser of $8,000 or $100 per complete month from the original due date to the request.
Talk to an accountant. Thomas Lymburner is a real estate agent (broker), not an accountant, and does not give personal tax advice.
Generally yes: the gain must be reported and, for the exemption, form TP-274 must accompany your return. See the section above.
Sources
- Canada Revenue Agency — Reporting the sale of your principal residence for individuals — Consulté le 19 octobre 2026 / Accessed October 19, 2026
- Revenu Québec — Selling your property — Page mise à jour le 5 octobre 2023 / Page updated October 5, 2023
General information only. This is not tax or legal advice: confirm your situation with an accountant, a notary or a lawyer.