ARTICLE · 20 JANUARY 2023

Underused Housing Tax Act

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On January 1, 2022, a tax on underused housing in Canada came into effect. This tax on vacant or underused housing in Canada is the result of the Underused Housing Tax Act...

CanadaTax

Frédéric Delisle

On January 1, 2022, a tax on underused housing in Canada came into effect. This tax on vacant or underused housing in Canada is the result of the Underused Housing Tax Act, which received Royal Assent on June 9, 2022 (the "Act", link).

This new tax is amongst a number of measures introduced to slow down the overheating real estate markets in Canada. One only has to think of the rental cost of a property located in Vancouver, Toronto, or Montreal to understand the intention behind these measures. Other measures include the newly enacted Prohibition on the Purchase of Residential Property by Non-Canadians Act (link), which also came into effect earlier this year.

The Act essentially imposes two obligations on affected owners:

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