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Canada's Underused Housing Tax (UHT)
This Affects All Owners of Canadian Residential Property Except Excluded Owners!
The legislation for the Underused Housing Tax Act was included in Bill C-8, An Act to implement certain provisions of the economic and fiscal update, which received Royal Assent on June 9, 2022. It was originally proposed in the Federal 2021 Budget.
 | Effective January 1, 2022, for the 2022 calendar year. | ||||||
| All owners, other than Canadian citizens or permanent residents of Canada must file a declaration as to the current use of residential property owned by them and located in Canada. This statement from the 2021 Budget is quite misleading. | ||||||
| A Canadian citizen or permanent resident will have to file a declaration if they are an owner of the residential property in their capacity as a trustee of a trust (other than a personal representative in respect of a deceased individual) or as a partner of a partnership. | ||||||
| Private corporations which own residential property will have to file a declaration. Public corporations are considered "excluded owners" | ||||||
| The penalty for failure to file is a minimum of $5,000 for an individual or $10,000 if the person is not an individual. | ||||||
| National annual 1% tax on the value of underused or vacant residential property. | ||||||
| An exemption from the tax may be available to be claimed by the owner of the property. | ||||||
| The tax is based on the taxable value of residential property located in
Canada considered to be vacant or underused, if the owner is not a Canadian
citizen or permanent resident of Canada. Taxable value means an amount that is:
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| A person may elect to use the fair market value of the property. | ||||||
| Due date for the Underused Housing Tax return, election for fair market value, and the payment of tax for a calendar year is April 30th of the following calendar year. |
See Bill C-8 Legislative Summary Part 2: Enactment of the Underused Housing Tax Act which lists excluded owners and exemptions. Owners who are exempt must still file a declaration.
See Video Tax News Life in the Tax Lane December 2022 for more information.
Government of Canada Resources
Budget 2021 Annex 7: Consultations on Other Tax Measures: Supplementary Information - search (ctrl-f) or scroll down to Tax on Unproductive Use of Canadian Housing by Foreign Non-resident Owners.
Economic and Fiscal Update 2021 - Tax Measures - Underused Housing Tax
Excise and GST/HST News - No. 112 - Underused housing tax program
Provincial Taxes on Property
BC Speculation and Vacancy Tax and City of Vancouver Empty Homes Tax
Ontario Taxes on Property - includes Foreign Buyers Tax, Ottawa and Toronto Vacant Home taxesRevised: November 30, 2022