Rental Portfolio Reporting

Four rental units had been acquired over eight years and were all being tracked in a single spreadsheet. Mortgage interest, property tax and insurance were entered as lump sums, repairs and improvements were mixed together, and the returns filed in earlier years reported the portfolio as though it were one property.

The client was considering selling one of the units and had no reliable record of what had been spent on it.

What the Client Needed

Per-property reporting that would stand up if questioned, a correct split between current repairs and capital improvements, a considered decision on capital cost allowance, and an adjusted cost base for each property that would make an eventual sale straightforward to report.

What We Did

Each property was separated into its own set of records, with shared costs allocated on a documented basis and mortgage interest split by the actual balance on each loan. Every expense over the ownership period was reviewed and reclassified where necessary — a roof replacement and a suite conversion moved to the capital side, while ongoing maintenance stayed current.

We prepared a T776 for each property and modelled the effect of claiming capital cost allowance against the recapture that would arise on sale, which led to CCA being claimed on two properties and deliberately not on the two most likely to be sold.