Missed the T2091 Deadline? Here's What It Means for Your Principal Residence Sale
It usually starts with a sigh of relief.
The house is sold. The paperwork is done. The funds are in the bank. But months later—while prepping for tax season—a founder realizes something’s missing: the T2091 form.
This isn’t just a forgotten document. It’s a required declaration to claim the Principal Residence Exemption in Canada. And late filing? It can trigger penalties of up to $8,000.
Let’s rewind.
A startup founder sold their home to fund their new venture. The sale wasn’t taxable—after all, it was their principal residence. But they didn’t file the T2091. They assumed no tax meant no paperwork. The CRA didn’t agree.
What Is Form T2091?
Form T2091 is used to designate a property as your principal residence when you sell it. Since 2016, the CRA requires this form even if the entire gain is exempt from tax.
What Happens If You File Late?
Late filing can result in:
Penalties: $100 per month, up to $8,000
Loss of Exemption: CRA may deny the principal residence exemption if the form isn’t filed
Extended Reassessment Period: CRA can reassess outside the normal 3-year window
What You Can Do
If you missed the deadline:
Contact CRA Immediately
You may qualify for taxpayer relief provisions, which have a 10-year window.Submit a Voluntary Disclosure
This can reduce penalties and show good faith.Work with a Tax Accountant
A Tax Accountant ensures compliance, tracks deadlines, and manages tax strategy proactively.
Don’t Let a Missed Form Derail Your Finances
Late filing of T2091 isn’t just a paperwork issue—it’s a financial risk. With a Tax Accountant you’ll stay ahead of deadlines, avoid penalties, and protect your exemptions. Let’s make sure your financial story is airtight.
Need help navigating CRA forms and deadlines? Let’s connect.
