Capital property is loosely defined as an asset that provides the owner (taxpayer) with a long-term and enduring benefit. A capital gain is the amount by which the proceeds of disposition exceed the adjusted cost base and any disposition costs related to the sale of the capital property. The Act has different rules for different types of property, in particular: the Personal-Use Property (PUP) and the Listed Personal Property (LPP). Personal Use Property is any type of property owned by the taxpayer for means of personal enjoyment for the taxpayer, any beneficiary or related persons. Capital losses may never be offset against any capital gains, but gains are included in income. Listed personal property is a subset of personal use property that does not depreciate. Unlike PUP, losses on LPP can be claimed, but only against LPP gains. For more information, please consult www.cra.gc.ca.
Author: Natalie Leung