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Can we transfer principal residence status to our cottage?

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My husband and I plan to sell our home and live at the cottage when we retire in about 10 to 15 years. Can we claim principal residence status for our home when we sell it, then claim principal residence status for our cottage when or if we eventually sell that?
—Kris Muysson, via e-mail

Yes. If you have two properties, and you sell one—say, your house—you can choose to designate it as your principal residence for some or all of the years that you’ve owned it. You can also use the principal residence exemption for your other property (the cottage) when you eventually sell that—as long as the years don’t overlap. You’re only allowed to designate one property as your principal residence for a particular year. To figure out how to best take advantage of the exemption, you should look at how long you’ve owned each property, how much each has appreciated, and, of course, whether or not both will qualify as principal residences under the Canada Revenue Agency’s conditions.