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Underused Housing Tax Transitional Relief

As many of our clients know, a new tax policy called the Underused Housing Tax is being imposed by the Canada Revenue Agency (CRA) for the first time for the 2022 tax year. The filing deadline for the annual return relating to this tax is April 30, 2023, but the CRA has allowed a grace period for penalties and interest to October 31, 2023.



The new tax applies primarily to non-resident, non-Canadian citizens who owned a residential home in Canada as of December 31, 2022. Under the new regime, regardless of whether the tax is actually payable, an annual return form is due for all non-resident non-Canadian homeowners on or before April 30 of each calendar year, beginning in 2023. Canadian small corporations that own residential homes must also file a return confirming that ownership and control of the corporation is held by Canadian citizens.


Details regarding this tax may be found on CRA’s website:



The rules for this tax are complicated, so we recommend that clients contact a Canadian accountant to assist them in determining whether the tax applies to their properties, and in filing the annual return form.



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