After Monsieur acquired a duplex in January 2011, he used the two units for renting to a third party and as his personal residence, respectively. In July 2019 he ceased to rent out the first unit, and appropriated it to his residence. He made a s. 45(3) election respecting his change of use under s. 45(1)(c) (as permitted by the 2019 Budget changes). After referring to the initial residence unit as Unit 2 and the expanded unit as Unit 3, CRA stated:
The taxpayer will therefore have to file two worksheets and two T2091 forms … if the taxpayer wishes to designate Unit 2 and Unit 3 as his principal residence for the applicable years.
Where an election under subsection 45(3) is made, the taxpayer must inform the CRA by enclosing a duly signed letter to that effect with the taxpayer’s return for the year in which the taxpayer actually disposed of the property , or earlier if the CRA issues a formal demand for that election. In that letter, the taxpayer should provide all relevant information related to the change of use.