Yes, you can legally sell your house to your son for $1 in Canada, but it is rarely advisable from a tax perspective. The Canada Revenue Agency (CRA) will not recognize the $1 price; instead, they will deem the transaction to have occurred at Fair Market Value (FMV), triggering capital gains taxes for you based on the home's appreciation, unless it is your principal residence.
Yes, you can sell your son your house for $1 in Canada. The law does not address whether it is worth the money, it only looks at whether money changed hands. Another way to do this is to put him on the title as Joint Tenant, which means he owns 50% but you still have the right to live there, as does he.
Yes, gifting property to your child in Canada can trigger capital gains tax, as the Canada Revenue Agency treats the transfer as if you sold the property at fair market value. However, a principal residence exemption may reduce or eliminate the tax if the property was your primary home.
A property should never be transferred to a family member for sale proceeds that are less than the fair market value (“FMV”) of the property. Doing so would trigger double taxation, where both the transferor and the recipient can be taxed on the same growth.
If your parents sell you their home for less than it's worth, the IRS treats that discount as a gift known as a “gift of equity.” As the gift recipient, you don't have to pay taxes on that money but your parents may have to file a gift tax form.
Gift Tax in Canada
Canada does not impose a gift tax on cash gifts to family members. You can give any amount of cash to a family member without worrying about a gift tax. However, if you're gifting to a minor child, any income earned from that gift may be attributed back to you for tax purposes.
Sell Your Home
You may consider the option of selling your house to your children. If you sell the house for less than fair market value, the difference in price between the full market value and the sale price will be considered a gift.
To reduce tax on an inherited house, consider strategies like:
Inheriting a home provides a “step-up” in cost basis for capital gains tax purposes, meaning you're taxed only on appreciation after the date of inheritance. By contrast, buying a house for $1 means your cost basis is the original owner's purchase price — potentially leading to higher taxes if you sell in the future.
The short answer: Yes, you can absolutely sell a home below market value—and legally gift the difference. It's a legitimate and frequently used estate planning strategy that can support younger generations, avoid probate, and reduce estate tax exposure.
The "3-3-3 rule" in real estate isn't a single guideline but refers to different strategies: for buyers, it's about financial readiness (3 months savings, 3 months reserves, 3 property comparisons) or a financial affordability check (30% income, 30% down, 3x income); for agents, it's a marketing habit (call 3, note 3, share 3) or prospecting (talking to everyone within 3 feet). There's also a developer rule (1/3 land, 1/3 build, 1/3 profit), though it's considered outdated by some.
You can choose from two main methods to price a home sale to a family member: make a gift of equity or sell the home at fair market value. If both parties aren't careful, a gift of equity can result in significant gift tax implications.
5 ways to transfer ownership of property from parents to child
The sale of your principle private residence is exempt from capital gains tax as long as you have lived in the house for the entire period that you have owned it and it was used as your only or main residence during your entire period of ownership.
Step-Up in Basis for Inherited Assets
One tax advantage of leaving assets after death is the step-up in basis. This provision allows heirs to inherit assets at their fair market value at the time of death, effectively resetting the capital gains tax to zero for any appreciation during the decedent's lifetime.
Yes, you can gift your son $100,000, but since it's over the 2025 annual exclusion of $19,000, you'll need to file a gift tax return (Form 709), though you likely won't owe taxes unless you've already used up your large lifetime exemption (over $13.99 million in 2025). Your son pays no tax on the gift, but you, as the giver, must report the amount exceeding the annual limit, which counts against your lifetime exemption.
You can gift as much money as you want to your children in theory, but large gifts may be subject to tax. For the 2025/26 tax year , every UK citizen has an annual tax-free gift allowance of £3,000. This enables you to give money to your children in lump sums without worrying about inheritance tax (IHT).
The most tax-efficient way to leave a home to a child usually involves leaving it in your will for them to inherit, which qualifies for a stepped-up tax basis (reducing capital gains tax if sold) and avoids immediate gift taxes, though trusts (like Revocable Living Trusts for probate avoidance or QPRTs for advanced planning) or Transfer-on-Death (TOD) deeds (where available) offer control and probate avoidance, while outright gifting is generally less tax-efficient due to inherited basis issues. Consulting an estate planning attorney is crucial to choose the best method for your specific situation.