Housing Loss

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If you pay an amount to an employee (or to a person related to the employee) as compensation for a loss sustained on the sale of the employee's former residence or a decrease in the value of the residence (hereinafter referred to as a "housing loss"), the amount constitutes a taxable benefit.

The value of the taxable benefit is equal to the result of the following calculation:

  • one half of the result of the following calculation: the total amount paid in the year and in a previous year for the housing loss, minus $15,000;


  • the value of the benefit included in the taxpayer's income in a previous year with respect to the amount paid for the housing loss.
This calculation applies to amounts that you pay for only one residence for any given move.

At any given time, a housing loss is equal to the result of the following calculation:

  • the greater of:
    • the highest fair market value (FMV) of the residence within the six-month period ending at that time, and
    • the adjusted cost base of the residence at that time;


  • the lesser of:
    • the FMV of the residence at that time, and
    • the proceeds of disposition, if the residence was disposed of before December 31 of the following year.

Any amount you pay to an employee (including the value of any assistance you provide to the employee) for the acquisition, use or right of use of a residence is also taxable.


You may pay an employee an amount (or provide an employee assistance) so that he or she can pay or reimburse:

  • mortgage interest;
  • property taxes;
  • insurance;
  • costs incurred to keep the former residence in good condition after the move;
  • higher mortgage interest or bridge financing required with respect to the new residence.

You have to include the value of the benefit in boxes A, G, I and L of the employee's RL-1 slip (see courtesy translation RL-1-T).

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