Should you continue to rent a cottage or buy one?
You don't need me to explain the personal benefits of owning a vacation home or cottage. But for many people, a cottage is also an investment. There is also a cost in the hope that you will return, especially if you decide to rent it. If you're hoping to buy, find out what you need to pay beyond the asking price and how you can finance the purchase.
Read: Is a vacation home a good investment?
Are there any tax exemptions for cottage capital gains?
Sorry to be the bearer of bad news, but there is none. There used to be a $100,000 lifetime cash benefit exemption, but that's gone. It only operated in Canada from 1984 to 1994. There are other ways to reduce the tax on the sale of a cottage, however. What about selling to a family member: Can you avoid taxes that way? It depends on several factors, such as the relationship, if the second place is wanted as a primary residence, and more.
Read: Can I sell my house tax free?
Read: Selling a small house to a family member: What that means for capital gains
Do you pay tax when you get a cottage?
Short answer: It depends on your relationship with the person who owns it. Are you an extended family member? Their oldest child? Or are you their partner? Find out how inheriting a cottage can affect your spouse with children's taxes and what steps you can take to reduce what you owe.
Read: Estate cottage and capital gain results
How to reduce the tax on the sale of the cottage
The following article goes over the many factors that can affect how you plan for cash flow on family-owned cottages, including:
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