CRA is applying its policy on the invalidity of s. 45(3) elections on duplex units only prospectively for changes of use after February 21, 2012

In a Technical Interpretation dated February 21, 2012, CRA indicated that, since a duplex (unless it has been partitioned) is a single property, the change in use of one of the units is not eligible for a s. 45(3) election. When queried about this, CRA stated:

The CRA therefore no longer accepts an election under subsection 45(3) for a change of use referred to in the position taken on February 21, 2012 where this change occurred after that date.

However, the CRA continues to accept an election made under subsection 45(3) after February 21, 2012 for a change of use referred to in the position taken February 21, 2012 where this change of use has been made on or before February 21, 2012 and where it also qualified for this election prior to this position being taken.

Neal Armstrong. Summary of 7 October 2016 APFF Financial Strategies and Instruments Roundtable, Q.4 under s. 45(3).