When I was 22, I found out my great aunt had included me in her will. 🥳
Naturally, I started dreaming big: Would I pay off my tuition? Study abroad? Buy a car? 🚗 ✈ 🎓
But reality hit hard. The probate process took a long time, and I didn’t see a dime until the following year. ⌛ 💵
This same frustration is what many sellers face
When they sell their home and move abroad, only to discover that the Canada Revenue Agency (CRA) requires a clearance certificate. 🤯
Without it, a significant portion of their sale proceeds is held back. Sometimes for up to 8 months
🚨 The CRA Curve Ball 🚨
Most real estate agents don’t realize that when Canadians move abroad, they can be considered non-residents under the Income Tax Act.
This triggers a requirement to apply for a clearance certificate, and the holdback isn’t just on net proceeds. It’s on the purchase price. 💰
The New Reality in 2026:
For principal residences, the holdback is now 35%. 🏚
For rental properties, it’s a whopping 50%. 🏢
💵 A $187,500 Wake-Up Call 💵
I recently had clients who sold their home for $750,000 before relocating to London, UK.
A 25% holdback meant $187,500 sat idle in my trust account while we waited for the clearance certificate. 😭
And as we all know, CRA isn’t exactly speedy. These certificates can take up to 8 months. ⏲
💡How to Save Your Clients Time and Money
If you’re a real estate agent with clients relocating out of the country, act fast:
1⃣ Call a lawyer to determine if a clearance certificate is required.
2⃣ If they’re considered non-residents, loop in an accountant immediately to start the process.
3⃣ With enough notice, accountants may even secure a comfort letter from CRA, avoiding the holdback altogether.
Be the Hero Your Clients Need 🦸 🦸
Don’t let your clients’ hard-earned money sit in limbo. Be proactive, and you’ll save them time, stress, and a lot of cash. 💸 ✨
Need help navigating clearance certificates? Call me anytime! 📞
-Erin
📞 Realtor® Hotline
Real estate isn’t 9-5, and neither am I. Call me anytime, even on weekends and evenings, for legal advice when you need it most.
587-570-7428