New Residential Rental Property Rebate Case Studies
6 worked New Residential Rental Property Rebate case studies — the position a client typically comes to us with, what we do, and what it is worth. Each is an illustrative example built on the rules that apply to new residential rental property rebate work, not a specific client's file.
Case Study 1 · Sale and succession
$475,000 Sheltered By The Lifetime Capital Gains Exemption — Restaurant Group, Winnipeg
Client: A restaurant group · Where: Winnipeg, Manitoba · Engagement: 11 weeks, fixed fee
Gain sheltered$475,000
ClosingOn schedule
Share qualificationMet
The situation — A restaurant group, Winnipeg, Manitoba
A restaurant group in Winnipeg, Manitoba had an offer on the table and 14 months to close. The shares did not qualify for the capital gains exemption, and a shareholder loan balance that would have been picked up as income on closing was part of the reason.
What we did for A restaurant group, Winnipeg, Manitoba
We purified the corporation so the shares met the qualifying tests, then filed the section 156 election for the related registrants, so supplies between them stopped carrying tax that served no purpose but cash-flow drag well ahead of the closing date.
The result — A restaurant group, Winnipeg, Manitoba
The sale closed on schedule with $475,000 sheltered by the lifetime capital gains exemption across the shareholders.
Case Study 2 · Backlog brought current
7 Years Filed, $143,000 Removed From The Assessed Balance — Interprovincial Marketing Agency, Toronto
Client: A marketing agency billing outside its home province · Where: Toronto, Ontario · Engagement: 4 weeks, fixed fee
Years filed7
Assessed balance removed$143,000
CollectionsStopped
The situation — A marketing agency billing outside its home province, Toronto, Ontario
A marketing agency billing outside its home province in Toronto, Ontario had not filed for 7 years. The CRA had issued arbitrary assessments, and the business was carrying a registration threshold crossed nine months before anyone registered on top of a growing interest balance.
What we did for A marketing agency billing outside its home province, Toronto, Ontario
We started with the oldest year and worked forward so each year's closing balances fed the next. We assembled the export documentation, restored zero-rating on the qualifying sales, and reduced the proposed assessment, filing the years in sequence rather than all at once.
The result — A marketing agency billing outside its home province, Toronto, Ontario
Every year is now filed and assessed on actual figures. The notional assessments were vacated and $143,000 of the estimated balance came off, with a payment arrangement covering the rest.
Client: A SaaS company with Canadian and US customers · Where: Windsor, Ontario · Engagement: 7 weeks, fixed fee
Annual saving$17,500
ReorganisationTax-neutral
StructureMatches operations
The situation — A SaaS company with Canadian and US customers, Windsor, Ontario
A SaaS company with Canadian and US customers in Windsor, Ontario was carrying a commercial property purchase closed on the assumption no tax applied because the vendor was not registered, and every option for fixing it ran through a reorganisation that had to be done without triggering tax.
What we did for A SaaS company with Canadian and US customers, Windsor, Ontario
Working with the client's lawyer, we set a defensible input tax credit allocation between taxable and exempt supplies and documented the method for future filings and prepared the elections, resolutions and valuations the structure needed to stand up.
The result — A SaaS company with Canadian and US customers, Windsor, Ontario
The structure now matches the business. Annual saving of $17,500, and the reorganisation itself was tax-neutral.
Case Study 4 · Objection and relief
Notice Of Objection Allowed In Full, $78,000 Reversed — Multi-Province Online Retailer, Burnaby
Client: A multi-province online retailer · Where: Burnaby, British Columbia · Engagement: 8 weeks, fixed fee
Amount reversed$78,000
ObjectionAllowed in full
Account balanceNil
The situation — A multi-province online retailer, Burnaby, British Columbia
A multi-province online retailer in Burnaby, British Columbia had been reassessed for $78,000 and had 16 days left on the objection deadline. The reassessment rested on export sales zero-rated with no shipping documentation behind them.
What we did for A multi-province online retailer, Burnaby, British Columbia
We filed the objection inside the deadline with a complete submission rather than a placeholder, and backdated the registration to the day the threshold was crossed, remitted the tax owing, and applied for relief on the penalty portion.
The result — A multi-province online retailer, Burnaby, British Columbia
The appeals officer allowed the objection in full. $78,000 was reversed and the account returned to a nil balance.
Case Study 5 · Deadline rescue
Filed On Time From A Standing Start, $35,500 Penalty Avoided — Exempt-Supply Clinic, Hamilton
Client: A health clinic making exempt supplies · Where: Hamilton, Ontario · Engagement: 5 weeks, fixed fee
Penalty avoided$35,500
Turnaround5 weeks
FiledOn time
The situation — A health clinic making exempt supplies, Hamilton, Ontario
A health clinic making exempt supplies in Hamilton, Ontario came to us 5 weeks before its filing deadline with HST charged at the home-province rate on sales into four different provinces. A late filing would have triggered a penalty of roughly $35,500 before interest.
What we did for A health clinic making exempt supplies, Hamilton, Ontario
We worked backwards from the deadline. We rebuilt the sales ledger by customer province, applied the correct place-of-supply rate to each stream, and filed corrected returns before the CRA opened a review, prioritising the items that actually gated the filing and deferring everything that did not.
The result — A health clinic making exempt supplies, Hamilton, Ontario
The return was filed on time and complete. The $35,500 penalty never arose, and the compliance calendar we set means the next deadline is scheduled rather than discovered.
Case Study 6 · Records and systems rebuilt
Month-End Close Cut From 12 Weeks To 8 Days — Mixed-Use Landlord, Calgary
Client: A residential landlord also renting commercial space · Where: Calgary, Alberta · Engagement: 5 weeks, fixed fee
Close time before12 weeks
Close time after8 days
Year-endReview, not rebuild
The situation — A residential landlord also renting commercial space, Calgary, Alberta
The accounting file at a residential landlord also renting commercial space in Calgary, Alberta was built on management fees between two related registrants carrying tax that only ever went out and came back. The year-end had taken 12 weeks each of the last three years.
What we did for A residential landlord also renting commercial space, Calgary, Alberta
We tested the quick method against the account’s actual input tax credit history and stayed on the regular method where the credits were worth more and moved the reconciliations into the monthly cycle, so the year-end stopped being a rebuild.
The result — A residential landlord also renting commercial space, Calgary, Alberta
The file reconciles. Month-end closes in 8 days instead of 12 weeks, and the year-end is a review rather than a reconstruction.
Reviewed for the 2025 tax year by Udit Gupta, Founder and Tax Accountant. These case studies are illustrative worked examples composed from the CRA rules that apply to this type of work, not specific client files; figures are representative and outcomes depend on your own facts.
