For Americans and other non-residents with property in Canada
Non-Residents Who Own Property in Canada: Renting It and Selling It
Yes, Canada can tax you even if you live elsewhere. If you rent it out, 25% of the gross rent is generally withheld, unless you use the section 216 process to be taxed on net rent. If you sell it, you generally notify the CRA and seek a certificate of compliance, and a buyer can be liable if there is none. Gurleen Kaur, CPA licensed in British Columbia and Washington State, prepares the US returns and the Canadian T1 and T2. Based in Surrey, working with clients across Greater Vancouver, the rest of Canada and remotely.
Quick answer
How does Canada tax a non-resident who owns Canadian property?
On rent, the payer or agent must withhold 25% of the gross rent, and you can elect under section 216 to file a return and be taxed on net rental income (CRA). On a sale, you must notify the CRA within 10 days of the disposition, or before it, with payment or acceptable security (CRA). Your facts decide how these apply.
At a glance
- Rent
- 25% withheld on gross rent by default
- Net rent
- Section 216 return, with Form NR6 for withholding on net
- Sale
- Notice within 10 days on Form T2062, with payment or security
- If you are American
- Your US return generally reports it too
- Source
- CRA, checked November 4, 2026
Renting it out
- The default. The payer or your agent must withhold 25% of the gross rent. The agent must be a resident of Canada (CRA).
- Section 216. You can elect to file a Canadian return for your rental income and be taxed on the net amount. Generally the return is due within two years from the end of the year the rent was paid or credited (CRA).
- Form NR6. This is an undertaking to file, which can let your agent withhold on net rental income instead of gross. If the CRA approves it, the return has an earlier due date: June 30 of the following year (Form NR6).
Selling it
- Notify the CRA. Notice is required within 10 days of the disposition, or you can notify before it, along with payment or acceptable security for the tax (CRA). The usual form is Form T2062.
- Certificate of compliance. The CRA issues it once the notice and payment or security are in place. In some cases involving residential property and non-Canadian owners, the CRA may refuse to issue one (CRA).
- The buyer. Without a certificate, the buyer can become liable for tax, which is why buyers and lawyers hold back funds (IC72-17R6).
- A return afterward. You generally still file a Canadian return to report the sale and claim back any excess (IC72-17R6).
If you are a US citizen or green card holder
The US taxes you on worldwide income, wherever the property is (IRS). So rent or a gain on a Canadian property usually belongs on your US return as well, with a foreign tax credit question to work through. See Form 1116 and the foreign tax credit and other Canadian withholding waivers.
How we help
Gurleen Kaur, CPA licensed in British Columbia and Washington State, prepares the US returns and the Canadian T1 and T2. So your Canadian section 216 return or sale filing and your US return are prepared together. Everything is quoted after review, with a written scope before work begins. A lawyer handles the closing itself.
Common questions
Do I have to pay 25% on my rent forever?
Not necessarily. The section 216 process can let you be taxed on net rental income instead. Whether it suits you depends on your income and expenses.
Can a property manager handle the withholding?
Your agent must withhold and remit, and must be a resident of Canada. You remain responsible for your own return.
What happens if I sell without a certificate?
The buyer can become liable for tax, so expect funds to be held back at closing. Start early.
Do you prepare both my Canadian and US returns?
Yes. Gurleen Kaur, CPA, prepares the US returns and the Canadian T1 and T2.
Sources
Every rule and figure on this page links to the IRS, CRA or other official source it comes from. Amounts change; we re-check them before each engagement.
- CRA: Guide T4144, electing under section 216
- CRA: Form NR6
- CRA: Disposing of or acquiring certain Canadian property
- CRA: Information Circular IC72-17R6
- CRA: Form T2062
- IRS: US citizens and resident aliens abroad
Gurleen Kaur, CPA licensed in British Columbia and Washington State. Last updated November 4, 2026. This page is general information, not tax or legal advice for your situation.
Related guides: US tax accountant in Surrey and Greater Vancouver, Foreign tax credit, Regulation 105 waivers, Buying US real estate.
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