Tax

Profit from an assignment is often taxed as business income (100% taxable), not a capital gain. Since January 1, 2023, the federal residential property flipping rule treats gains on housing, including rights to buy housing like pre-construction contracts, held less than 365 days as business income unless a life-event exemption applies.

Usually, yes. For assignment agreements entered into on or after May 7, 2022, the assignment of a purchase agreement for a newly built house or condo is generally a taxable supply for GST/HST. Tax applies to the assignment price, excluding the part that reimburses the deposit. In Ontario, that means 13% HST on the assignor’s profit portion.