Budget 2026: Changes To The Taxable Canadian Property Rules

Budget 2026¹ proposes a number of changes to the rules governing dispositions of taxable Canadian property (“TCP“) by non-residents. The amendments are intended to reduce withholding and compliance burdens in certain circumstances, facilitate tax-deferred corporate reorganizations, and strengthen an existing anti-avoidance rule applicable to certain rollover transactions.

The proposed changes are particularly relevant to non-resident corporations disposing of Canadian investments, Canadian purchasers acquiring property from non-residents, and cross-border corporate reorganizations involving Canadian assets.

The principal measures are:

• A reduction in the withholding rates applicable to dispositions of TCP by non-resident corporations;