Non-tax residents must comply with complex tax regulations and requirements when renting out properties. Rental income needs to be reported to the tax authorities, and related tax withholding issues must also be dealt with. If not handled properly, there may be fines or other legal consequences.

For landlords who don’t live in the local area, managing and maintaining a rental property can become very difficult. Not being able to personally handle daily matters such as tenant communication and property maintenance can lead to a decrease in the value of the property or frequent rental problems.

Since you have income from renting out your property in Canada, according to Canadian tax law, even as a non-resident of Canada, you are still obliged to report and pay taxes on your income in Canada to the Canadian government. If you fail to fulfill your obligations on time, there will be penalties and interest.

If you plan to sell your house in the future, this work is particularly important, because if you fail to declare income and pay taxes on time, you will not be able to get the full house price when you sell the house. The lawyer who takes over the house will withhold part of the house price on behalf of the tax bureau because the tax relationship of your house sale has not been sorted out.

Therefore, in order to avoid penalties/interest/withholding of part of the house payment, we recommend that customers declare and pay taxes on time, and we are also very willing to help you.

👉 Let's introduce the specific operation process. The specific operation is divided into the following two situations:

1. You pay taxes to the Canadian government as a non-tax resident

In this case, you need to prepay taxes to the Canada Revenue Agency at 25% of your monthly gross rental income in each rental year, and then declare the specific rental income and expenses of the previous year during March-June of the second year. The tax agency will refund or supplement the difference between your tax return and the prepaid tax.

The information you need to provide is as follows:
✅ Copy of passport (for applying for tax number)
✅ House purchase contract ✅ House handover lawyer documents (for fee deduction)
✅ House rental contract ✅ Bank account information (used to set up pre-authorization so that the tax bureau can deduct the prepaid tax directly from your account)

two, You sign an authorization agreement with a Canadian agent, who uses his or her own credit to file and pay taxes on your behalf to the tax authorities.

In this case, you need to apply to the tax bureau for agent authorization at the end of each year before the year in which you rent out the house. Once approved, you can prepay taxes to the Canada Revenue Agency based on 25% of your estimated monthly net rental income (i.e. rental income minus estimated expenses) in each rental year. Then, during February to April of the following year, you need to declare the specific rental income and expenses of the previous year. The tax bureau will refund or supplement the difference between your tax return and the prepaid tax.

The information you need to provide is as follows:

✅ Copy of passport (for applying for tax number)
✅ House purchase contract ✅ House handover lawyer documents (for fee deduction)
✅ House rental contract ✅ Bank account information (used to set up pre-authorization so that the tax bureau can deduct the prepaid tax directly from your account)

👉 In addition, if you plan to sell your house, in order to ensure that you can get the full payment on time when the house is handed over, it is recommended that you apply for a tax clearance certificate in time.

If the tax clearance certificate is not obtained, the tax bureau will impose a fine of $25/day starting from the tenth day after the house handover date, with a maximum of $2,500/year. In order to avoid fines and get the full house payment in time, we recommend that customers apply for the tax clearance certificate in time. The specific process of application is as follows:

1. After the purchase contract is finalized, apply for the tax clearance certificate immediately.
2. Due to the limited processing speed of the tax bureau, it is recommended to leave a certain amount of time between the house delivery date and the contract signing date to apply for the tax clearance certificate.
3. The information you need to provide is as follows:
✅ House sale contract✅ House purchase contract✅ House handover lawyer documents when buying a house

If you need to declare relevant taxes, please contact us! We are committed to helping non-tax residents rent out properties smoothly, solving complex tax issues and management problems, making your investment more secure and efficient.

How can we help you?

Contact us at Golden Key Business Development Center, we can provide you with the following services:

✅ Tax consulting and planning : Helping you understand your tax obligations as a non-resident rental property, ensuring you comply with Canadian tax laws and minimize your tax burden.

✅ Rent Management : Our professional rental management service will ensure the stability and continuity of your rental income, handle various tenant issues, and ensure that your property is properly maintained.

✅ Legal consultation : We provide professional legal support to help you deal with the signing of lease contracts and tenant management issues to ensure that your rights and interests are protected.

With our services, you can easily navigate the challenges of renting out property as a non-tax resident and enjoy the many benefits of renting out property.

What are the benefits of having us handle your taxes?

✅ Compliance guarantee

Our professional team is well versed in the latest tax laws and ensures that financial reporting is compliant.

Our professional team will ensure

All steps and documents are reliable and complete

If you need

Regarding non-tax residents renting out properties, this video will definitely help you!