There are really only two things to note if you wish to buy here as a foreigner: In Canada you must pay 25% of your rental income to Revenue Canada and when you sell you need to pay 25% of any capital gain. Whoa – “Ouch” you say. Not to worry – it is 25 per cent of the NET rent and the NET capital gain – as long as you file the appropriate forms and have a Canadian agent, otherwise taxes will be collected on the gross rent and/or the sale price.

To do:

  1. Once you buy the property, immediately file a form called the NR6 in advance of the first day of rental income. Attach a pro forma rental statement, for example: “I expect $2,000 a month, my expenses are $1,900. My net rental income is expected to be only $100.” Then you only need to pay $25 per month to the (less) happy taxman. You have to file that form every December.
  2. You need a tax agent in Canada who represents you – could be a realtor, property manager or tax accountant. Your agent must file form NR4 with Revenue Canada before March 31 to state how much rent actually was collected.
  3. He or she must file a tax return on your behalf every year by June 30.
  4. When you sell with a profit you file form T2062 (say you paid $800,000 and sold for a million – of the $200,000 profit the taxman will grab happily $50,000).
  5. If you made your euros growing the “wacky tobaccy” and you wish to pay cash, your rental agent, by law is required to report your cash down payment ($10,000 plus).

That’s it. But please note: Just because it is easy, legal and safe to own property in canada, it does not mean that all property is a good investment – just as in the place you come from. There are good and bad deals, good and bad agents and it is up to you to do some research, find an experienced agent, and if what you are buying sounds too good to be true – it is.

Need help? Contact me at 604-273-2002 or www.NotaPennyDown.com

Mark Fidgett | 604-273-2002


“Your Personal Mortgage Consultant….For Life!”

PS – Please Don’t Keep Me a Secret
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T 604.273.2002 | F 604.522.2072
W http://www.notapennydown.com


An independent Mortgage Specialist associated with the Verico Mortgage Network.