Tag Archive for Canada Underused Housing Tax

A Primer On Canada’s Vacant Home Taxes For U.S. Citizens And Residents

Vacant Home Taxes

Disclaimer: This post is of a general nature. I will assume that the owner of the property is an individual person. This post does NOT address situations where the property is owned by a corporation, trust or other kind of entity. Vacant property regimes are different and may include enhanced rules for situations where residential property is NOT owned by people (including corporations, trusts, etc.). Under NO circumstances should the information in this post be considered to be complete. It is designed to provide an overview. In many cases you will be well advised to seek professional help. (I am thinking mainly of Canada’s Underused Housing Tax and the BC “Speculation And Vacancy” taxes.)

Outline:

Part I – Introduction – The Housing Shortage Of 2023
Part II – Impacts of Canada’s Underused Housing Tax on Canadian border communities
Part III – How Vacant Home Taxes Work – The Usage Of The Property ALWAYS Matters And Can Ensure The Tax Is Avoided
Part IV – How Vacant Homes Tax Differ – The Three Categories Of Taxes
Part V – The BC “Speculation And Vacancy Tax” – Moving To Canada
Part VI – Concluding Thoughts

Part I – Introduction – The Housing Shortage Of 2023

Vacant home taxes are a new kind of tax in Canada. They are the inevitable result of a rise in housing prices, a shortage of rental housing caused by short term rentals (AirBNB and others), a rise in rents (caused by the shortage of rental housing) and a political climate that is responsive to the housing shortage. This is NOT just a problem in Canada, but also in other countries. A recent New York Times article reported on similar conditions in Portugal (which interestingly resulted in the cancellation of Portugals “Golden Visa Program”).
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Written by | Posted in TaxConnections • Vacant Home Taxes

Canada’s Underused Housing Tax: No Good Options For U.S. Residents Who Own A Second Home In Canada

Canada's Underused Housing Tax: No Good Options For U.S. Residents Who Own A Second Home In Canada

Introduction – Responding To Canada’s Underused Housing Tax

Canada’s Underused Housing Tax is NOT a tax imposed because the “foreign owner” doesn’t spend enough time in the property. Rather Canada’s Underused Housing Tax is a tax imposed because the “foreign owner” doesn’t make the property sufficiently available to non-owners!!

This is the fourth in my series of posts about Canada’s “citizenship-based” Underused Housing Tax.

The first three posts are:

1. US Residents Who Own Residential Property In Canada May Be Subject To Various Vacant And Underused Property Taxes

2. NY Congressman Brian Higgins Draws Attention To The Injustice Of Citizenship Taxation By Challenging Canada’s Underused Housing Tax

3. U.S. FBAR And Form 8938 Penalties May Be A Bigger Problem For U.S. Residents Than Canada’s Underused Housing Tax

The purpose of this post is two-fold:

First: to explain what “Canada’s Underused Housing Tax” really means for “foreign owners” of certain Canadian property:

Conclusion: It means that foreign owners who own property that is NOT in a designated recreational location and who do NOT release their property into the rental market will be forced to pay the 1% tax.

Second: to explain that owners of most Canadian residential property that is not in a designated recreational location, who are neither Canadian citizens nor permanent residents of Canada can avoid releasing their property into the rental market ONLY if they either:

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Written by | Posted in Canadian Housing Tax • Citizenship Solutions