On 1/20/2022 2:55 PM, [email protected] wrote:
This isn't really a GnuCash question, but I thought I might ask you guys
anyway as there's a broad variety of skills and experience here.
Situation: a relative owns a house on a six acre property, plus several
adjacent properties she's collected over the years. Under Canadian tax
rules, the house and some of the lot it's on are tax exempt. The other
properties are taxable for capital gains. They will be sold over the next
years, one at a time to keep marginal rates down. There will also be
significant sales expenses (commissions, surveyors, .) associated with each
sale.
My question is about how to structure this tax and sales costs liabilities
in the Chart of Accounts, and thus the balance sheet.
I do not know Canadian law/accounting practice. But here, with real
Estate, some of the "expenses" you list would be additions to the
"basis" and sale - basis would be the capital gain. This is significant
because capital gains are taxed differently than current income.
You really need to consult a Canadian accountant, or if DYI, consult
accounting texts that deal with Canadian real estate and taxes.
Michael D Novack
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