Skip to navigation Skip to content

Sale of real estate by instalment or deferred payment 108-04070060

Expand/Collapse all sectionsExpand all


This document outlines the assessment of income from the sale of real estate which is not the customer's principal home.

Sale of real estate

A separate procedure covers deferred sale or sale by instalment of principal home.

The sale of a property, where the purchase price is paid over an agreed period, may be treated as income depending on whether or not the sale creates a loan, or a sale agreement.

Loan

If the sale creates a loan, the loan is subject to deeming.

Sale agreement

In a sale agreement, money moves from the purchaser to the seller subject to the terms of the contract. If a sale agreement:

  • provides for interest to be paid on the outstanding purchase price balance, the interest payable is treated as income for social security purposes
  • does not provide for interest to be paid on the outstanding purchase price balance, it may be necessary to obtain an actuarial valuation of the payments due

Income from the sale of real estate which is deferred or paid by instalments should be referred to a Complex Assessment Officer (CAO) for assessment.

The Resources page contains examples of using the discount factor formula to determine the estimated value of the property.

Coding income and assets

Assessing and coding the Real estate form MOD R

Sale of principal home

Identifying and making suitable referrals to the Complex Assessment Officer (CAO)