Virginia American selling Canadian cottage or home to a

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I hope that you can help me, i have looked all over the web for information on "american selling canadian property to a canadian" I cannot find anything..
I am an american who wants to sell my cottage 
that is located in Canada to a canadian.
I was told by an aquantiance that i may have to get a permit to sell it.
I was also told that the canadian government will withhold 37% of the sale price until that permit is issued.
I s that true ? Where do i get this permit and is it even nessesary ?
Im not even sure as to what i am supposed to do as an american....
hope you can help.
david ingram replies:
The rules are the same whether you sell the property to a Canadian, an American, a German or a citizen of any other of the 190+ countries out there.
Any purchaser buying a property from a non-resident must withhold 25% of the purchase price and remit it to the Canadian CRA (Canada Revenue Agency), the equivalent of your IRS.
If however, you, the seller(s) fill out forms T2062 and T2062A (both if it was ever rented), and show what the actual profit on the sale will be, the CRA will issue a certificate allowing a 25% withholding of the profit part only.  
This means that if you paid $200,000 and are selling it for $200,000 and send a proper form with a copy of your original purchase, there will be NO withholding.
If you paid $200,000 and sold it for $210,000 with a $12,000 real estate commission, there would be a $2,500 withholding even though you lost $2,000 because at this stage, you cannot deduct the real estate commission.
Next march, you would file a Canadian T1 General and get your $2,500 back becuase youcan deduct the real estate commission on the actual tax return.
At the moment, we are looking after sales for residents of London England, Minneapolis, Minnesota, Palm Springs, Seattle and Mexico.  We look after the tax deferral form, the Canadian tax return and will look after your US and Virginia returns as well or if you have a US preparer you really want to use, we will prepare a dummy US return so that your US preparer can just plug in the figures and not have to spend four hours figuring out where they go.  (You do not want to be the one to train a US preparer on foreign tax credits.)
I would be happy to look after yours.
There is NO rollover for rental properties in Canada as there is in the United States.
The purchaser of the unit you are selling is required to deduct 25% of the gross sale price as a payment against possible capital gains tax unless you calculate the actual profit by filing forms T2062 (for any property) and T2062A (when it is a rental property).
If the property was a rented property, you also need to file a T2062A with the T2062.
If the property was rented, you should have been filing Canadian returns under Section 216(4) (Form T1 plus 776) to report the rental income to Canada. 
You will also have to repay the tax on any CCA (Capital Cost Allowance or depreciation) you have claimed against the rental income.
Answers to this and other similar  questions can be obtained free on Air every Sunday morning.
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Old shows are archived at the site.
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