It is not possible for a non-severable piece of land to have two different beneficial owners for the primary residence and business sections.
The owner of a non-severable farming land wishes to transfer the farming section of the property to a corporation that they wholly own, while maintaining beneficial ownership of the farmhouse. However, it was determined that the individual would not be eligible to claim the principal residence exemption for any future sale of the farming parcel made by the corporation.
The essential rights of ownership of a property used as an individual’s principal residence cannot be transferred or retained separate from the ownership of the rest of the property because the individual does not retain the right of alienation (that is, the ability to transfer the property).
Comparable situations can occur in various settings, such as when a corporation possessing non-severable real estate intends to sell the building directly to a third-party buyer and the land "via" an affiliate with net capital losses.
“Please note that the information provided in this article is of a general nature and may not be accurate for your specific situation. The information is current as of the date of posting and is not intended to provide legal advice. It's always recommended that you consult with a professional accountant and lawyer for personalized guidance and advice."