A question is raised by a concerned taxpayer who declared rental payments as income as well as capital gains on a condo that was sold while his friends who invested with him plan not to. If you own a residence and don’t live there, you need to report any money made on renting as well as capital gains when sold or you could be assessed with heavy penalties. As long as the taxpayer paid based on his percentage of profit, he should be okay, but his partners could run into trouble and penalties at any time for not doing so.

“The partners who didn’t report the income will be faced with the lesser penalty of 10% of the amount of income they didn’t report, or 50% of the difference between the tax they paid and should have paid.”

Read more: https://www.moneysense.ca/columns/ask-moneysense/what-happens-if-you-dont-pay-taxes-on-the-sale-of-a-condo/