Owns 2 one acre lots. David Ingram

My question is: Canadian-specific
QUESTION: Hi,
I live in Scotch Creek B.C. My question is a capital gain issue.
I own 2 one acre lots side by side with my home on one of them. I
consider living on them both as one 2 acre piece. If I sell them
together can I get the gains break on both?
Thanks,
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david ingram replies:
I had another Scotch Creek case a few years ago and someplace on
that old bridge, I carved my initials during the Adams River
Salmon Run in 1964.
If the second lot was needed for the purpose of a septic field,
the second lot would absolutely be tax free. This is because the
"law" requires you to have the second lot to build on the first -
i.e. it is absolutely necessary by law.
Life Style might also work - If the second lot was necessary
because it was a wood lot and you heat with wood, or you raised
goats because you are allergic to cow dairy and drink goats milk
or you raised three sheep for food, (not for sale), etc., it was
necessary and should be tax free.
--------------
Read the following
In 1991, Marianne Fourt received a favorable ruling from the
Federal
Court Trial Division when the court ruled in favor of the tax
free
status of the second lot. The judge ruled that although not
essential to
the use and enjoyment of the family home, it clearly contributed
to the
use and enjoyment within the meaning of paragraph 54(g)(v) of the
Act.
She had lost in 1988 as stated below.
In 1988, Marianne Fourt paid tax on an adjoining lot she sold.
She
bought two lots and built her home on one and used the second lot
for an
incinerator, storage shed and parking. Judge Goetz of the Tax
court
ruled that she could have built everything on one lot and the
other was
not necessary, i.e., could not be done without.
---------------------------
In any case, the law also states that 1/2 hectare or 1.22 acres
is tax free.  If the second lot does not work as all tax free,
22% of it will / should be in addition to your other one acre.
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