In recent years, the CRA has also been cracking down on perceived abuse of the PRE even when properties are held for more than a year. Take the recent decision of the Tax Court, decided in June 2025, involving a Toronto taxpayer whose 2016 tax return was reassessed by the CRA because he failed to report a capital gain of $159,282 on the sale of residential real estate. To make matters worse, he was also hit with a $21,000 gross negligence penalty for failure to report the gain.