When real estate is purchased from a non-resident of
Canada, the non-resident is required to complete and submit
a form to Canada Revenue Agency (CRA), along with a tax of
25% of the gain on the property. CRA will then provide
a certificate of compliance (T2064 or T2068) to the
purchaser and the vendor. If the non-resident vendor
does not pay this tax, the purchaser of the property will be
liable. Thus, the purchaser may withhold 25% (50% in
some cases) of the cost of the property.
The above tax applies to some other types of Canadian
property besides real estate. For more information on
this topic, see the Canada Revenue Agency guide T4058
Non-Residents and Income Tax.
Tax Tip: Know the
tax implications when buying from a non-resident.
Revised: June 09, 2013