Joel DyckReal Broker SK Ltd.
Saskatoon · From the topic map

Will I owe taxes on down-payment gift money?

No. Canada has no gift tax, so money a parent or family member gives you toward a down payment is not taxed to you or to the person giving it, according to the Canada Revenue Agency's treatment of personal gifts between individuals.

Your lender will still want a gift letter confirming the money is a true gift with no expectation of repayment, since a loan disguised as a gift changes your actual debt load, and CMHC lending guidelines require a minimum down payment of 5 percent to $500,000 before that gift can count toward it.

The giver should keep their own records of the transfer regardless, since the tax-free treatment applies to the recipient, and any income the gifted money later earns for you, interest in a savings account, for example, is taxable to you going forward even though the original gift was not.

None of this affects what your future home is worth, only what you can put down on it. Get your hand-reviewed valuation from Joel Dyck.

Get your hand-reviewed valuation from Joel Dyck.

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