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yzfr1
Real Estate Talker
Posts: 218
Joined: Tue Mar 19, 2013 8:35 pm

Re: What must the governments do to stop speculation?

Sun Apr 23, 2017 1:07 pm

reallyreal2 wrote:
yzfr1 wrote:
reallyreal2 wrote:
The person buying would, of course, include the assignment payment on the purchase of the condo to their ACB.
You buy an assignment for $100K on a $500K condo meaning you paid $600K for the condo - when it comes time to sell, you are going to use $600K as your ACB.  CRA can very easily now go back and compare your cost against the sale agreement when you purchased - they will ask to review your purchase agreement with the developer and the assignment agreement.  Then they check to see if the person that assigned you the paper claimed the gain on their taxes.  Alternatively, CRA work the other way and audit the developer and compare the pre-sale agreements with who actually closed on the unit - if there is a difference, they can determine that there was an assignment.  Once an assignment is identified, you don't have to be Sherlock Holmes to determine the assignment agreement.  You say it is a side deal where both parties can say it was $1 - great, when the buyer of the assignment sells their place, their ACB is lower and they are paying more tax.
It's really very simple if you can think logically for more than 3 minutes at a time.



reallyreal2 wrote:
The person buying would, of course, include the assignment payment on the purchase of the condo to their ACB.
You buy an assignment for $100K on a $500K condo meaning you paid $600K for the condo - when it comes time to sell, you are going to use $600K as your ACB.  CRA can very easily now go back and compare your cost against the sale agreement when you purchased - they will ask to review your purchase agreement with the developer and the assignment agreement.  Then they check to see if the person that assigned you the paper claimed the gain on their taxes.  Alternatively, CRA work the other way and audit the developer and compare the pre-sale agreements with who actually closed on the unit - if there is a difference, they can determine that there was an assignment.  Once an assignment is identified, you don't have to be Sherlock Holmes to determine the assignment agreement.  You say it is a side deal where both parties can say it was $1 - great, when the buyer of the assignment sells their place, their ACB is lower and they are paying more tax.
It's really very simple if you can think logically for more than 3 minutes at a time.


Simmer down there..

If they wanted to tax the presale contract. Upon transfer of the contract the actual value of the sale would be declared. Both sides would write it down and would be registered in a binding contract.

If buyer wants to declare actual value, then seller won't give him the discount. Its in the buyers interest to declare less so buyer and seller can save on tax.

Because value is declared on the spot of sale of contract there will be no future changes in value and CRA blah blah blah.

Reallyreals whole argument is netrualizes with basic logic. Again wasting everyone's time with stupid posts.

I think you are starting to go to TDMA's school of english via Google Translate.
I have zero idea what you are talking about - mostly because you don't have a clue.  
Above, I have very simply explained how CRA can track down assignment contracts.  I have zero clue what your point is.
If what you are saying is that the buyer and seller are colluding on price of an assignment so the seller avoids tax - and by doing so, the seller is giving the buyer a discount.... well then the seller has paid tax by accepting less proceeds (just the buyer in this case is the beneficiery).  Then when the buyer goes to sell, his ACB will be lower by the discount... meaning they will pay more tax when they sell.
Again - think this through step by step ... it's not that hard.

If what you are saying is that the buyer and seller are colluding on price of an assignment so the seller avoids tax - and by doing so, the seller is giving the buyer a discount.... well then the seller has paid tax by accepting less proceeds (just the buyer in this case is the beneficiery).
Ill make this easy for you to understand,
Party A has a contract on a $500,000 apartment. Person B wants to buy that contract, they agree on $10,000. There is no way anyone can know the amount of the agreed upon purchase of the contract. That's a private # only party A and party B are privy to. If there is regulation changes, and thus forcing a amount to be disclosed in the event of a contract change. The only way to ascertain that information is for Party A and B is to declare that value in the contract takeover. That value will always be fraudulently lower.  
Part A would be on the hook for tax $1,200. Party A can turn around and say the sale was $1 and both split this difference of $600. Party A still gets his $9,400 instead of $ 8,800 and party B pays $9,400 instead of $10,000

Then when the buyer goes to sell, his ACB will be lower by the discount... meaning they will pay more tax when they sell.

When you do your tax, try adding "pre sale $" and deduct. You just made that up, its a practice that doesn't exist. If this was allowed the fraud would be huge, it would be even more beneficial to overstate the value. 
Also for most people there would be no taxes when the seller sells.

Before you go on shooting your mouth. Why dont you answer EyesTheBall... you kept claiming there was $2 million dollars sales in 2015 in gradview area. Tyga tried be nice and give you benefit of the doubt.
You can't be a troll when you can't win the argument and when you feel like you want to add some input have people take you seriously.
Don't be such a scum bag. Have some humanity
 
reallyreal2
Real Estate Talker
Posts: 624
Joined: Fri Jun 03, 2016 11:30 am

Re: What must the governments do to stop speculation?

Sun Apr 23, 2017 2:24 pm

Let's agree to disagree.

You clearly don't understand what I am trying to say and vice versa.
 
reallyreal2
Real Estate Talker
Posts: 624
Joined: Fri Jun 03, 2016 11:30 am

Re: What must the governments do to stop speculation?

Sun Apr 23, 2017 2:27 pm

reallyreal2 wrote:
yzfr1 wrote:
reallyreal2 wrote:

Sorry - I don't think you understand how presales work.  It is a contract - you have to buy at a future date.  You don't have an option to buy and if the market goes down walk away.

Ok as a bear I assume you never owned property before. You can absolutely walk away anytime, its called breach of contract. You lose your deposit. 

You can lose a whole lot more than just your deposit.
http://www.cbc.ca/news/canada/british-c ... s-1.802301
""There are plenty of cases in which vendors of property, not necessarily developers, have had deals with purchasers, where purchasers have backed out, and the vendors have sued, successfully for … the difference between the purchase price with the original deal, and what they get on a resale," said Whyte.
Real estate lawyer Ron Usher, who is not connected to the case, confirmed that if the developer resells the condo for less money, it can sue the original buyer for the difference.
"The contracts are quite clear. They have a right to claim that against the original purchaser," said Usher."

You are not buying an option to buy when you sign a pre-sale contract.  You are on the hook for the contract.  

FYI - you assumed wrong.  I own my home and have owned a few condos in the past.  Even purchased a presale in the past. 

yzfr - it's cute that you completely ignore this post that proves you being 100% completely and utterly wrong.
Keep up the good work.  you clearly don't know much about how things work 
 
tdma800
Real Estate Talker
Posts: 2882
Joined: Wed Jan 23, 2008 9:12 am

Re: What must the governments do to stop speculation?

Sun Apr 23, 2017 3:08 pm

yzfr1 wrote:
reallyreal2 wrote:
yzfr1 wrote:




Simmer down there..

If they wanted to tax the presale contract. Upon transfer of the contract the actual value of the sale would be declared. Both sides would write it down and would be registered in a binding contract.

If buyer wants to declare actual value, then seller won't give him the discount. Its in the buyers interest to declare less so buyer and seller can save on tax.

Because value is declared on the spot of sale of contract there will be no future changes in value and CRA blah blah blah.

Reallyreals whole argument is netrualizes with basic logic. Again wasting everyone's time with stupid posts.

I think you are starting to go to TDMA's school of english via Google Translate.
I have zero idea what you are talking about - mostly because you don't have a clue.  
Above, I have very simply explained how CRA can track down assignment contracts.  I have zero clue what your point is.
If what you are saying is that the buyer and seller are colluding on price of an assignment so the seller avoids tax - and by doing so, the seller is giving the buyer a discount.... well then the seller has paid tax by accepting less proceeds (just the buyer in this case is the beneficiery).  Then when the buyer goes to sell, his ACB will be lower by the discount... meaning they will pay more tax when they sell.
Again - think this through step by step ... it's not that hard.

If what you are saying is that the buyer and seller are colluding on price of an assignment so the seller avoids tax - and by doing so, the seller is giving the buyer a discount.... well then the seller has paid tax by accepting less proceeds (just the buyer in this case is the beneficiery).
Ill make this easy for you to understand,
Party A has a contract on a $500,000 apartment. Person B wants to buy that contract, they agree on $10,000. There is no way anyone can know the amount of the agreed upon purchase of the contract. That's a private # only party A and party B are privy to. If there is regulation changes, and thus forcing a amount to be disclosed in the event of a contract change. The only way to ascertain that information is for Party A and B is to declare that value in the contract takeover. That value will always be fraudulently lower.  
Part A would be on the hook for tax $1,200. Party A can turn around and say the sale was $1 and both split this difference of $600. Party A still gets his $9,400 instead of $ 8,800 and party B pays $9,400 instead of $10,000

Then when the buyer goes to sell, his ACB will be lower by the discount... meaning they will pay more tax when they sell.

When you do your tax, try adding "pre sale $" and deduct. You just made that up, its a practice that doesn't exist. If this was allowed the fraud would be huge, it would be even more beneficial to overstate the value. 
Also for most people there would be no taxes when the seller sells.

Before you go on shooting your mouth. Why dont you answer EyesTheBall... you kept claiming there was $2 million dollars sales in 2015 in gradview area. Tyga tried be nice and give you benefit of the doubt.
You can't be a troll when you can't win the argument and when you feel like you want to add some input have people take you seriously.
Don't be such a scum bag. Have some humanity

he/she/it gave you a compliment.     perhaps donate a cookie in return
 
tdma800
Real Estate Talker
Posts: 2882
Joined: Wed Jan 23, 2008 9:12 am

Re: What must the governments do to stop speculation?

Sun Apr 23, 2017 3:09 pm

yzfr1 wrote:
reallyreal2 wrote:
yzfr1 wrote:
I was referring to applying a arbitrary tax to transferring a pre-sale contract. As I stated before, its impossible to put a value on the contract.
I think you are very confused at the moment.
"you can have all contracts resisted by a lawyer and tracked by the land titles office" the contracts are already registered with the layers. The contracts is between the seller (developer)  and the buyer (home owner) All this piece of paper is a agreement to buy the property for a set price at a future date. The contract is not the same as buying the actual property. No titles are transferred or issued until the strike date of the contract which is completion. For instance its up to the developer to decide how much downpayment he wants from the buyer and when. Now a days they are asking for as much as 25%. Again this is not mandated by real-estate rules for conventional deals. Usually deposit is 5% until subject removals. It's not a realestate transaction until the contract is executed and the buyer decides to exercise his right to buy the property at the agreed price.
Again with the withholding of the profits... how the heck is anyone going to know what the actual profits are or the losses of the pre-sale contract.
the purchase of the pre-sale lets say for example $500,000
when someone sells the "contract" for $20,000. The $20,000 is not tacked onto the $500,000.
The contract to buy the condo has no intrinsic value. Hence can't be added to net loss or gain for the person buying. So it will always result to a side deal. There is absolutely no reason for either party to admit gains. If anything capital loss would be abused. 
please take time to read my previous posts. and try to understand what I posted.. it's very clear.

It's called a "Pre-sale" as in there is no sale yet!

no losses or net gains can be occurred where then is no sale!

The person buying would, of course, include the assignment payment on the purchase of the condo to their ACB.
You buy an assignment for $100K on a $500K condo meaning you paid $600K for the condo - when it comes time to sell, you are going to use $600K as your ACB.  CRA can very easily now go back and compare your cost against the sale agreement when you purchased - they will ask to review your purchase agreement with the developer and the assignment agreement.  Then they check to see if the person that assigned you the paper claimed the gain on their taxes.  Alternatively, CRA work the other way and audit the developer and compare the pre-sale agreements with who actually closed on the unit - if there is a difference, they can determine that there was an assignment.  Once an assignment is identified, you don't have to be Sherlock Holmes to determine the assignment agreement.  You say it is a side deal where both parties can say it was $1 - great, when the buyer of the assignment sells their place, their ACB is lower and they are paying more tax.
It's really very simple if you can think logically for more than 3 minutes at a time.



reallyreal2 wrote:
yzfr1 wrote:
I was referring to applying a arbitrary tax to transferring a pre-sale contract. As I stated before, its impossible to put a value on the contract.
I think you are very confused at the moment.
"you can have all contracts resisted by a lawyer and tracked by the land titles office" the contracts are already registered with the layers. The contracts is between the seller (developer)  and the buyer (home owner) All this piece of paper is a agreement to buy the property for a set price at a future date. The contract is not the same as buying the actual property. No titles are transferred or issued until the strike date of the contract which is completion. For instance its up to the developer to decide how much downpayment he wants from the buyer and when. Now a days they are asking for as much as 25%. Again this is not mandated by real-estate rules for conventional deals. Usually deposit is 5% until subject removals. It's not a realestate transaction until the contract is executed and the buyer decides to exercise his right to buy the property at the agreed price.
Again with the withholding of the profits... how the heck is anyone going to know what the actual profits are or the losses of the pre-sale contract.
the purchase of the pre-sale lets say for example $500,000
when someone sells the "contract" for $20,000. The $20,000 is not tacked onto the $500,000.
The contract to buy the condo has no intrinsic value. Hence can't be added to net loss or gain for the person buying. So it will always result to a side deal. There is absolutely no reason for either party to admit gains. If anything capital loss would be abused. 
please take time to read my previous posts. and try to understand what I posted.. it's very clear.

It's called a "Pre-sale" as in there is no sale yet!

no losses or net gains can be occurred where then is no sale!

The person buying would, of course, include the assignment payment on the purchase of the condo to their ACB.
You buy an assignment for $100K on a $500K condo meaning you paid $600K for the condo - when it comes time to sell, you are going to use $600K as your ACB.  CRA can very easily now go back and compare your cost against the sale agreement when you purchased - they will ask to review your purchase agreement with the developer and the assignment agreement.  Then they check to see if the person that assigned you the paper claimed the gain on their taxes.  Alternatively, CRA work the other way and audit the developer and compare the pre-sale agreements with who actually closed on the unit - if there is a difference, they can determine that there was an assignment.  Once an assignment is identified, you don't have to be Sherlock Holmes to determine the assignment agreement.  You say it is a side deal where both parties can say it was $1 - great, when the buyer of the assignment sells their place, their ACB is lower and they are paying more tax.
It's really very simple if you can think logically for more than 3 minutes at a time.


Simmer down there..

If they wanted to tax the presale contract. Upon transfer of the contract the actual value of the sale would be declared. Both sides would write it down and would be registered in a binding contract.

If buyer wants to declare actual value, then seller won't give him the discount. Its in the buyers interest to declare less so buyer and seller can save on tax.

Because value is declared on the spot of sale of contract there will be no future changes in value and CRA blah blah blah.

Reallyreals whole argument is netrualizes with basic logic. Again wasting everyone's time with stupid posts.

sounds like a rabbit because both of them drop bubble tea out a few times a day lol
 
VanLord
Real Estate Talker
Posts: 269
Joined: Fri Aug 24, 2007 3:52 pm

Re: What must the governments do to stop speculation?

Sun Apr 23, 2017 5:31 pm

yzfr1 wrote:
reallyreal2 wrote:
yzfr1 wrote:




Simmer down there..

If they wanted to tax the presale contract. Upon transfer of the contract the actual value of the sale would be declared. Both sides would write it down and would be registered in a binding contract.

If buyer wants to declare actual value, then seller won't give him the discount. Its in the buyers interest to declare less so buyer and seller can save on tax.

Because value is declared on the spot of sale of contract there will be no future changes in value and CRA blah blah blah.

Reallyreals whole argument is netrualizes with basic logic. Again wasting everyone's time with stupid posts.

I think you are starting to go to TDMA's school of english via Google Translate.
I have zero idea what you are talking about - mostly because you don't have a clue.  
Above, I have very simply explained how CRA can track down assignment contracts.  I have zero clue what your point is.
If what you are saying is that the buyer and seller are colluding on price of an assignment so the seller avoids tax - and by doing so, the seller is giving the buyer a discount.... well then the seller has paid tax by accepting less proceeds (just the buyer in this case is the beneficiery).  Then when the buyer goes to sell, his ACB will be lower by the discount... meaning they will pay more tax when they sell.
Again - think this through step by step ... it's not that hard.

If what you are saying is that the buyer and seller are colluding on price of an assignment so the seller avoids tax - and by doing so, the seller is giving the buyer a discount.... well then the seller has paid tax by accepting less proceeds (just the buyer in this case is the beneficiery).
Ill make this easy for you to understand,
Party A has a contract on a $500,000 apartment. Person B wants to buy that contract, they agree on $10,000. There is no way anyone can know the amount of the agreed upon purchase of the contract. That's a private # only party A and party B are privy to. If there is regulation changes, and thus forcing a amount to be disclosed in the event of a contract change. The only way to ascertain that information is for Party A and B is to declare that value in the contract takeover. That value will always be fraudulently lower.  
Part A would be on the hook for tax $1,200. Party A can turn around and say the sale was $1 and both split this difference of $600. Party A still gets his $9,400 instead of $ 8,800 and party B pays $9,400 instead of $10,000

Then when the buyer goes to sell, his ACB will be lower by the discount... meaning they will pay more tax when they sell.

When you do your tax, try adding "pre sale $" and deduct. You just made that up, its a practice that doesn't exist. If this was allowed the fraud would be huge, it would be even more beneficial to overstate the value. 
Also for most people there would be no taxes when the seller sells.

Before you go on shooting your mouth. Why dont you answer EyesTheBall... you kept claiming there was $2 million dollars sales in 2015 in gradview area. Tyga tried be nice and give you benefit of the doubt.
You can't be a troll when you can't win the argument and when you feel like you want to add some input have people take you seriously.
Don't be such a scum bag. Have some humanity



It's between party a and b and the taxman. Just because people are cheating doesn't make it legal. I thought you were going to stop discussing this.

Per my post the CRA requires Assignments to be reported and now you say it's a secret deal.

I'm pretty sure the builder is privy to the assignment price and I think the comment that the builder should be on the hook to track and report the assignment to the gov is spot on and the best way to deal with this cheating.

Yz I think you are playing silly bugger on this.


my whole point on this topic was that the CRA should apply already existing rules and force assignments to be taxed. I think this is particularly true when foreigners are involved so they are forced to pay taxes when profiting on cdn real estate. We have all agreed on this point.
 
tdma800
Real Estate Talker
Posts: 2882
Joined: Wed Jan 23, 2008 9:12 am

Re: What must the governments do to stop speculation?

Sun Apr 23, 2017 8:31 pm

VanLord wrote:
Yz I think you are playing silly bugger on this.

1. filthy mind.  'buggery'?
2. solution in search of a problem
3. is there even a folio for this vague assignment situation? not!!
 
tdma800
Real Estate Talker
Posts: 2882
Joined: Wed Jan 23, 2008 9:12 am

Re: What must the governments do to stop speculation?

Sun Apr 23, 2017 8:32 pm

reallyreal2 wrote:
Keep up the good work. 

thumbs up!!
 
jimtan
Real Estate Talker
Topic Author
Posts: 5303
Joined: Tue Jul 31, 2007 10:59 pm

Re: What must the governments do to stop speculation?

Sun Apr 23, 2017 8:59 pm

reallyreal2 wrote:
reallyreal2 wrote:
yzfr1 wrote:
Ok as a bear I assume you never owned property before. You can absolutely walk away anytime, its called breach of contract. You lose your deposit. 

You can lose a whole lot more than just your deposit.
http://www.cbc.ca/news/canada/british-c ... s-1.802301
""There are plenty of cases in which vendors of property, not necessarily developers, have had deals with purchasers, where purchasers have backed out, and the vendors have sued, successfully for … the difference between the purchase price with the original deal, and what they get on a resale," said Whyte.
Real estate lawyer Ron Usher, who is not connected to the case, confirmed that if the developer resells the condo for less money, it can sue the original buyer for the difference.
"The contracts are quite clear. They have a right to claim that against the original purchaser," said Usher."

You are not buying an option to buy when you sign a pre-sale contract.  You are on the hook for the contract.  

FYI - you assumed wrong.  I own my home and have owned a few condos in the past.  Even purchased a presale in the past. 

yzfr - it's cute that you completely ignore this post that proves you being 100% completely and utterly wrong.
Keep up the good work.  you clearly don't know much about how things work 

+1
 
tdma800
Real Estate Talker
Posts: 2882
Joined: Wed Jan 23, 2008 9:12 am

Re: What must the governments do to stop speculation?

Sun Apr 23, 2017 9:01 pm

reallyreal2 wrote:
reallyreal2 wrote:
yzfr1 wrote:
Ok as a bear I assume you never owned property before. You can absolutely walk away anytime, its called breach of contract. You lose your deposit. 

You can lose a whole lot more than just your deposit.
http://www.cbc.ca/news/canada/british-c ... s-1.802301
""There are plenty of cases in which vendors of property, not necessarily developers, have had deals with purchasers, where purchasers have backed out, and the vendors have sued, successfully for … the difference between the purchase price with the original deal, and what they get on a resale," said Whyte.
Real estate lawyer Ron Usher, who is not connected to the case, confirmed that if the developer resells the condo for less money, it can sue the original buyer for the difference.
"The contracts are quite clear. They have a right to claim that against the original purchaser," said Usher."

You are not buying an option to buy when you sign a pre-sale contract.  You are on the hook for the contract.  

FYI - you assumed wrong.  I own my home and have owned a few condos in the past.  Even purchased a presale in the past. 

yzfr - it's cute that you completely ignore this post that proves you being 100% completely and utterly wrong.
Keep up the good work.  you clearly don't know much about how things work 

-1
 
jimtan
Real Estate Talker
Topic Author
Posts: 5303
Joined: Tue Jul 31, 2007 10:59 pm

Re: What must the governments do to stop speculation?

Sun Apr 23, 2017 9:05 pm

VanLord wrote:
yzfr1 wrote:
reallyreal2 wrote:
I think you are starting to go to TDMA's school of english via Google Translate.
I have zero idea what you are talking about - mostly because you don't have a clue.  
Above, I have very simply explained how CRA can track down assignment contracts.  I have zero clue what your point is.
If what you are saying is that the buyer and seller are colluding on price of an assignment so the seller avoids tax - and by doing so, the seller is giving the buyer a discount.... well then the seller has paid tax by accepting less proceeds (just the buyer in this case is the beneficiery).  Then when the buyer goes to sell, his ACB will be lower by the discount... meaning they will pay more tax when they sell.
Again - think this through step by step ... it's not that hard.

If what you are saying is that the buyer and seller are colluding on price of an assignment so the seller avoids tax - and by doing so, the seller is giving the buyer a discount.... well then the seller has paid tax by accepting less proceeds (just the buyer in this case is the beneficiery).
Ill make this easy for you to understand,
Party A has a contract on a $500,000 apartment. Person B wants to buy that contract, they agree on $10,000. There is no way anyone can know the amount of the agreed upon purchase of the contract. That's a private # only party A and party B are privy to. If there is regulation changes, and thus forcing a amount to be disclosed in the event of a contract change. The only way to ascertain that information is for Party A and B is to declare that value in the contract takeover. That value will always be fraudulently lower.  
Part A would be on the hook for tax $1,200. Party A can turn around and say the sale was $1 and both split this difference of $600. Party A still gets his $9,400 instead of $ 8,800 and party B pays $9,400 instead of $10,000

Then when the buyer goes to sell, his ACB will be lower by the discount... meaning they will pay more tax when they sell.

When you do your tax, try adding "pre sale $" and deduct. You just made that up, its a practice that doesn't exist. If this was allowed the fraud would be huge, it would be even more beneficial to overstate the value. 
Also for most people there would be no taxes when the seller sells.

Before you go on shooting your mouth. Why dont you answer EyesTheBall... you kept claiming there was $2 million dollars sales in 2015 in gradview area. Tyga tried be nice and give you benefit of the doubt.
You can't be a troll when you can't win the argument and when you feel like you want to add some input have people take you seriously.
Don't be such a scum bag. Have some humanity



It's between party a and b and the taxman.  Just because people are cheating doesn't make it legal.  I thought you were going to stop discussing this.  

Per my post the CRA requires Assignments to be reported and now you say it's a secret deal.

I'm pretty sure the builder is privy to the assignment price and I think the comment that the builder should be on the hook to track and report the assignment to the gov is spot on and the best way to deal with this cheating.  

Yz I think you are playing silly bugger on this.


my whole point on this topic was that the CRA should apply already existing rules and force assignments to be taxed.  I think this is particularly true when foreigners are involved so they are forced to pay taxes when profiting on cdn real estate.  We have all agreed on this point.

+1
 
tdma800
Real Estate Talker
Posts: 2882
Joined: Wed Jan 23, 2008 9:12 am

Re: What must the governments do to stop speculation?

Sun Apr 23, 2017 9:06 pm

VanLord wrote:
yzfr1 wrote:
reallyreal2 wrote:
I think you are starting to go to TDMA's school of english via Google Translate.
I have zero idea what you are talking about - mostly because you don't have a clue.  
Above, I have very simply explained how CRA can track down assignment contracts.  I have zero clue what your point is.
If what you are saying is that the buyer and seller are colluding on price of an assignment so the seller avoids tax - and by doing so, the seller is giving the buyer a discount.... well then the seller has paid tax by accepting less proceeds (just the buyer in this case is the beneficiery).  Then when the buyer goes to sell, his ACB will be lower by the discount... meaning they will pay more tax when they sell.
Again - think this through step by step ... it's not that hard.

If what you are saying is that the buyer and seller are colluding on price of an assignment so the seller avoids tax - and by doing so, the seller is giving the buyer a discount.... well then the seller has paid tax by accepting less proceeds (just the buyer in this case is the beneficiery).
Ill make this easy for you to understand,
Party A has a contract on a $500,000 apartment. Person B wants to buy that contract, they agree on $10,000. There is no way anyone can know the amount of the agreed upon purchase of the contract. That's a private # only party A and party B are privy to. If there is regulation changes, and thus forcing a amount to be disclosed in the event of a contract change. The only way to ascertain that information is for Party A and B is to declare that value in the contract takeover. That value will always be fraudulently lower.  
Part A would be on the hook for tax $1,200. Party A can turn around and say the sale was $1 and both split this difference of $600. Party A still gets his $9,400 instead of $ 8,800 and party B pays $9,400 instead of $10,000

Then when the buyer goes to sell, his ACB will be lower by the discount... meaning they will pay more tax when they sell.

When you do your tax, try adding "pre sale $" and deduct. You just made that up, its a practice that doesn't exist. If this was allowed the fraud would be huge, it would be even more beneficial to overstate the value. 
Also for most people there would be no taxes when the seller sells.

Before you go on shooting your mouth. Why dont you answer EyesTheBall... you kept claiming there was $2 million dollars sales in 2015 in gradview area. Tyga tried be nice and give you benefit of the doubt.
You can't be a troll when you can't win the argument and when you feel like you want to add some input have people take you seriously.
Don't be such a scum bag. Have some humanity



It's between party a and b and the taxman.  Just because people are cheating doesn't make it legal.  I thought you were going to stop discussing this.  

Per my post the CRA requires Assignments to be reported and now you say it's a secret deal.

I'm pretty sure the builder is privy to the assignment price and I think the comment that the builder should be on the hook to track and report the assignment to the gov is spot on and the best way to deal with this cheating.  

Yz I think you are playing silly bugger on this.


my whole point on this topic was that the CRA should apply already existing rules and force assignments to be taxed.  I think this is particularly true when foreigners are involved so they are forced to pay taxes when profiting on cdn real estate.  We have all agreed on this point.

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jimtan
Real Estate Talker
Topic Author
Posts: 5303
Joined: Tue Jul 31, 2007 10:59 pm

Re: What must the governments do to stop speculation?

Sun Apr 23, 2017 9:08 pm

reallyreal2 wrote:
VanLord wrote:
reallyreal2 wrote:
The person buying would, of course, include the assignment payment on the purchase of the condo to their ACB.
You buy an assignment for $100K on a $500K condo meaning you paid $600K for the condo - when it comes time to sell, you are going to use $600K as your ACB.  CRA can very easily now go back and compare your cost against the sale agreement when you purchased - they will ask to review your purchase agreement with the developer and the assignment agreement.  Then they check to see if the person that assigned you the paper claimed the gain on their taxes.  Alternatively, CRA work the other way and audit the developer and compare the pre-sale agreements with who actually closed on the unit - if there is a difference, they can determine that there was an assignment.  Once an assignment is identified, you don't have to be Sherlock Holmes to determine the assignment agreement.  You say it is a side deal where both parties can say it was $1 - great, when the buyer of the assignment sells their place, their ACB is lower and they are paying more tax.
It's really very simple if you can think logically for more than 3 minutes at a time.


Thanks Really, good explanation, however I'm sure in the past the gov hasn't put two and two together and in the case of an offshore buyer, they walked away with the money years ago and the gov isn't going to be able do anything about it.  They need to take it a step further and make these determinations at the time of the assignment and I if taxes are owing they should be withheld, the same way they do off of normal income and in many cases investment gains are withheld at source.

I don't think it is a matter of identification of an assignment with an offshore buyer... probably more about collecting.
Wasn't there a news story not too long ago about the seller of the home being on the hook because the notary didn't do something correctly in identifying a foreign buyer.  I think if the burden is put on the developer, they would act as defacto police because they didn't want to become liable for the shadiness of an assignment grey market.

+1
 
tdma800
Real Estate Talker
Posts: 2882
Joined: Wed Jan 23, 2008 9:12 am

Re: What must the governments do to stop speculation?

Sun Apr 23, 2017 9:10 pm

reallyreal2 wrote:
VanLord wrote:
reallyreal2 wrote:
The person buying would, of course, include the assignment payment on the purchase of the condo to their ACB.
You buy an assignment for $100K on a $500K condo meaning you paid $600K for the condo - when it comes time to sell, you are going to use $600K as your ACB.  CRA can very easily now go back and compare your cost against the sale agreement when you purchased - they will ask to review your purchase agreement with the developer and the assignment agreement.  Then they check to see if the person that assigned you the paper claimed the gain on their taxes.  Alternatively, CRA work the other way and audit the developer and compare the pre-sale agreements with who actually closed on the unit - if there is a difference, they can determine that there was an assignment.  Once an assignment is identified, you don't have to be Sherlock Holmes to determine the assignment agreement.  You say it is a side deal where both parties can say it was $1 - great, when the buyer of the assignment sells their place, their ACB is lower and they are paying more tax.
It's really very simple if you can think logically for more than 3 minutes at a time.


Thanks Really, good explanation, however I'm sure in the past the gov hasn't put two and two together and in the case of an offshore buyer, they walked away with the money years ago and the gov isn't going to be able do anything about it.  They need to take it a step further and make these determinations at the time of the assignment and I if taxes are owing they should be withheld, the same way they do off of normal income and in many cases investment gains are withheld at source.

I don't think it is a matter of identification of an assignment with an offshore buyer... probably more about collecting.
Wasn't there a news story not too long ago about the seller of the home being on the hook because the notary didn't do something correctly in identifying a foreign buyer.  I think if the burden is put on the developer, they would act as defacto police because they didn't want to become liable for the shadiness of an assignment grey market.

-1
 
reallyreal2
Real Estate Talker
Posts: 624
Joined: Fri Jun 03, 2016 11:30 am

Re: What must the governments do to stop speculation?

Wed Apr 26, 2017 2:34 pm

reallyreal2 wrote:
reallyreal2 wrote:
yzfr1 wrote:
Ok as a bear I assume you never owned property before. You can absolutely walk away anytime, its called breach of contract. You lose your deposit. 

You can lose a whole lot more than just your deposit.
http://www.cbc.ca/news/canada/british-c ... s-1.802301
""There are plenty of cases in which vendors of property, not necessarily developers, have had deals with purchasers, where purchasers have backed out, and the vendors have sued, successfully for … the difference between the purchase price with the original deal, and what they get on a resale," said Whyte.
Real estate lawyer Ron Usher, who is not connected to the case, confirmed that if the developer resells the condo for less money, it can sue the original buyer for the difference.
"The contracts are quite clear. They have a right to claim that against the original purchaser," said Usher."

You are not buying an option to buy when you sign a pre-sale contract.  You are on the hook for the contract.  

FYI - you assumed wrong.  I own my home and have owned a few condos in the past.  Even purchased a presale in the past. 

yzfr - it's cute that you completely ignore this post that proves you being 100% completely and utterly wrong.
Keep up the good work.  you clearly don't know much about how things work 

hahahahaha...yzfr... you disappeared from this ever since getting your ass handed to you!   :lol:
You are clearly an amateur when it comes to these things... maybe you should sign up for a two week realtor course to become a "professional" and then you might understand a thing or two.  HHAHAHAHAHAHHAHAAHAHAHAH  :mrgreen:
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