CRA Turned $250K Profit Into $1.2M In Taxes
How a $250,000 Toronto house flip turned into a $1.167M CRA reassessment – and why HST rules, missing records, and audit deadlines can financially devastate real estate investors.
What To Do When CRA Audits You
📥 Free resources from this episode
Real Estate Tax Checklist for House Flippers
The Advisors TableReal Estate Tax Checklist for House Flippers
Compliance walkthrough for Canadian real estate deals — intention tests, documentation, and financing structure to avoid common CRA audit pitfalls.
Show Notes
In 2017, a man flipped a house in Toronto and made a $250K profit. Six years later, CRA audited him and hit him with a $1.167M tax bill.
This isn't a clickbait headline. It's a real audit case – and it could happen to anyone.
In this solo, Sunny breaks down exactly how a $250,000 profit turned into a $1.167M tax nightmare, and what we did to fight it.
In This Solo, We Cover:
• How a $250K profit turned into a $1.167M tax bill
• When CRA treats you as a builder for HST purposes
• The 90% renovation rule and why HST can apply to the full sale price
• Why missing receipts can erase hundreds of thousands in deductions
• The 90-day objection deadline and how CRA appeals really work
• Using affidavits, expert reports, and case law to challenge reassessments
• How this case was reduced by $770,000 on appeal
• Lessons every real estate investor and flipper needs to know
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