Non-Resident Rental Income Withholding Tax Payment Arrangement
Non-Resident Rental Income Withholding Tax Payment Arrangement
We can provide rental property WITHHOLDING TAX PAD for non-tax residents, helping you to safely and accurately pay applicable taxes and ensure your tax compliance. Based on the information of each property, we calculate the prepayment tax based on the 25% of monthly fixed rental income to ensure the safety of the transaction and reduce your institutional risks.
Note: Each change in monthly rental income will be considered an independent application. If necessary, please create multiple orders in different time periods to complete the rental prepayment application within a maximum of 24 months. Each order is for a single property. If there are multiple properties, please place a new order. Please place an order based on the known rental information to avoid forgetting to prepay taxes or incurring fines.
The price will revert to its original level from February 1st to April 30th. Customers who need the service should order it as early as possible before this period.
Application case:
If the monthly rental income of the same property changes three times in different time periods; you need to place three orders and fill in the order information according to the different time and amount each time.
Case background: The rent of property A from January to March 2025 is $3,000 per month; the rent from April to September 2025 increases to $5,000 per month; from October 2025 to September 2026, the rent is further increased to $5,500 per month.
Because the rent of property A changes at different stages, we calculate the prepayable taxes according to the specific amounts of each stage to ensure that the prepayment amount is consistent with your actual rental income to prevent insufficient or excessive prepayment.
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FAQ
1. What is Canadian non-resident landlord rental withholding tax?
If a landlord is a Non-Resident of Canada and earns rental income from property in Canada, they typically need to have the rent withheld according to Canadian non-resident tax rules and remitted to the CRA.
Generally, the withholding tax is:
Gross Rental Income × 25%
This type of tax is commonly referred to as:
- Non-Resident Rental Withholding Tax
- Part XIII Withholding Tax
- Canadian Non-Resident Rental Withholding Tax
- Prepaid Tax on Rental Property
2. Do all non-resident landlords renting out Canadian property have to prepay 25% tax?
Generally, yes.
If a non-resident of Canada earns rental income from Canadian real estate, the payer or Canadian agent typically needs to withhold 25% from the rent paid or credited to the landlord.
Without an approved NR6 from the CRA, this is usually calculated based on Gross Rental Income, not on profit after deducting expenses like property management fees, property taxes, and mortgage interest.
3. When do I need to remit the rental withholding tax to the CRA each month?
Generally, remittance needs to be completed by the 15th day of the month following the month in which the rent was paid or credited.
For example:
Rent received in January
→ The corresponding non-resident withholding tax should typically be remitted to the CRA by February 15.
If there is rental income every month, then monthly withholding tax remittances are usually required on an ongoing basis.
4. After remitting the monthly withholding tax, do I still need to complete an NR4?
Usually, yes.
Remitting the withholding tax to the CRA each month only completes the Remittance part.
After the end of the year, you also need to complete:
NR4 Slip + NR4 Summary / Information Return
Therefore, the complete non-resident rental tax process typically includes:
Monthly withholding and remittance
→ Annual NR4
→ If applicable, Section 216 Return
If using NR6, the NR6 application and annual Section 216 filing also need to be integrated into the overall compliance process.
5. Do tenants need to deduct 25% from the rent themselves?
For ordinary Canadian residential tenants, the CRA currently states that, generally, residential tenants are not required to actively determine if the landlord is a non-resident of Canada, nor are ordinary residential tenants expected to withhold 25% of the rent themselves.
Therefore, in practice, non-resident landlords typically arrange for a Canadian Agent, Property Manager, or professional service provider to assist with withholding and remittance.
6. What is an NR6?
Form NR6 – Undertaking to File an Income Tax Return by a Non-Resident Receiving Rent from Real or Immovable Property is a very important tax application for non-resident Canadian landlords.
If the NR6 is approved by the CRA, the agent can change from:
25% × Gross Rent
to:
25% × Net Rental Income
This means that, under eligible conditions, relevant rental expenses can be considered first before calculating the tax to be withheld.
7. After remitting the monthly withholding tax, do I still need to complete an NR4?
Usually, yes.
Remitting the withholding tax to the CRA each month only completes the Remittance part.
After the end of the year, you also need to complete:
NR4 Slip + NR4 Summary / Information Return
Therefore, the complete non-resident rental tax process typically includes:
Monthly withholding and remittance
→ Annual NR4
→ If applicable, Section 216 Return
If using NR6, the NR6 application and annual Section 216 filing also need to be integrated into the overall compliance process.