One year of purchasing and reselling a house by a renovator resulted in a capital gain.
A taxpayer and a friend purchased a Montreal house with the intention of renovating it and renting it out.
However, due to rising renovation costs and inability to rent it out, they resold it within a year at a profit.
The Tax Court of Canada found that they had realized a capital gain, despite not being habitual or sophisticated real estate investors.
The court stated that the resale was not an operating motivation for the purchase and was due to the difficulties faced by the taxpayers.
Similar findings were made for a transaction involving the taxpayer's mother.
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