What is it?
For any agreement of purchase and sale that was entered into on or after March 30, 2022, the Non-Resident Speculation Tax (NRST) rate was increased to 25% and now applies to any residential property purchased in Ontario by foreign nationals or by foreign corporations or taxable trustees.
Key Points
- If one person on title is a Canadian resident and the other is not, the NRST still applies (see spousal exemption).
- Each transferee is also jointly and severally liable for any NRST payable. If a foreign entity cannot pay the NRST, the other transferees will be required to pay the tax.
- Rebates are available for foreign nationals who become permanent residents, valid work permits (30 hours) with 1 year of continuous work experience, and students who are enrolled in full-time studies for 2 consecutive years.
- Exemptions to the above:
- Agricultural land
- Commercial or industrial property
- Non-taxable trusts
- Ontario Immigrant Nominee Program
- Refugees
- Spousal arrangements.
Important information to know
- The NRST applies in addition to the Land Transfer Tax (LTT) in Ontario.
- The NRST is payable at the time of registration through Teraview land registration system.
- Is still valid with the foreign ownership ban in place as it will cover exemptions such as properties outside the metropolitan census and agglomerate areas and properties of four units.
- The NRST does not apply if a Canadian citizen or permanent resident is living in another country and wishes to buy here in Canada.
- Regarding the permanent residence rebate, if the two named transferees are spouses of one another, only one of the spouses must become a permanent resident of Canada for the rebate to apply.
