Lawyer Answers (1): Answers from lawyers are general preliminary responses. They are not formal legal advice and cannot taken account of all your circumstances. They do not create a lawyer–client relationship.
There is no right to apply the retirement exemption before the deduction. If the 15 year retirement exemption is not available, the 50% deduction must be applied before the retirement exemption is applied. However you may choose not to apply the 50% deduction. But you cannot apply it after applying the retirement exemption. Please note that choosing not to apply the 50% deduction may be beneficial if capital gains is to be distributed to shareholders of a company.