Applicable to Canadians
The Underused Housing Tax is an annual 1% tax on the ownership of vacant or underused housing in Canada that took effect on January 1, 2022. The tax usually applies to non-resident, non-Canadian owners. In some situations, however, it also applies to Canadian owners.
Recently the CRA has come out with clearer guidance on who is required to file this form and it is capturing a lot more taxpayers than the accounting community initially thought.
If your own more than 1 property, or your name is on a property other than your principal residence, you may have a filing obligation. As such, you should contact your accountant to discuss in more depth.
The penalties for non-compliance are significant – $5,000 per person on title per property, and if the house is owned by a corporation the fine is $10,000. The deadline to remit the tax filing is April 30th 2023.
Tim Ward, Collingwood Mortgage Broker.
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