If you are renting a property, taking out a tenant insurance policy is an important safety net protecting you and your belongings if certain traumatic events occur. Check out this information on the basics of what is covered, what is not and the average cost per year. 

As a Foreign Seller looking to sell property in Canada, it is crucial to be aware of other significant concerns, in addition to the ongoing discussions surrounding the Foreign Buyer's Ban.

Seller Non Resident of Canada

In the context of a residential real estate transaction in Canada, withholding tax can apply to non-resident sellers of the property. The amount of withholding tax that a buyer of residential real estate in Canada may be required to withhold and remit to the Canada Revenue Agency (CRA) on behalf of a non-resident seller depends on the type of property being sold and whether it was used to generate income.

If the seller is a non-resident of Canada and the property was used to generate income, the buyer is required to withhold and remit 25% of the sale price related to the land value plus 50% of the sale price related to the building value, unless the seller obtains a Clearance Certificate from the CRA. If the property is capital property, meaning it is a personal-use property, such as a cottage or vacation home, and was not used to generate income, the buyer is required to withhold and remit 25% of the gross sale price.

Filing for a Clearance Certificate with the CRA as soon as your property is sold is best to avoid a withholding tax. If the seller applies for and obtains a Clearance Certificate from the CRA before the sale, they can provide it to the buyer, who then does not have to withhold any tax from the sale price. The Clearance Certificate confirms that the seller has complied with all Canadian tax laws and does not owe any taxes.

On the other hand, if the buyer fails to withhold the required amount of tax, they may be liable for any taxes owed by the seller, plus interest and penalties.

A Clearance Certificate is required in a residential real estate transaction in Canada when the seller is a non-resident of Canada. The certificate confirms that the seller has complied with all Canadian tax laws and does not owe any taxes. The Clearance Certificate serves as proof that the non-resident seller has paid any taxes owed to the Canada Revenue Agency (CRA) related to the sale of the property.

Obtaining a Clearance Certificate is the responsibility of the seller, who must apply to the CRA for the certificate after the sale has been completed. The application process can take several weeks to complete, and the seller must provide documentation to the CRA to support the application.

It's important for non-resident sellers of residential real estate in Canada to obtain a Clearance Certificate to avoid any delays or complications in the sale process. It's important to note that the rules and requirements related to withholding tax in residential real estate transactions can be complex and vary depending on the specific circumstances. Sellers and buyers of residential real estate in Canada should consult with a tax professional or lawyer to ensure compliance with applicable tax laws and regulations.

Seller of Underused Housing "Tax"

The Underused Housing Tax in Canada is an annual 1% tax on vacant or underused housing, which came into effect on January 1, 2022. The tax is primarily targeted towards non-resident, non-Canadian owners, although it can also apply to Canadian owners in certain circumstances. It is important to note that failure to file a return for this tax can result in significant penalties, with minimum penalties of $5,000 for individuals and $10,000 for corporations.

If you are a foreign seller of Airbnb properties, you may be required to pay the Underused Housing Tax. The tax applies to foreign real estate owners who do not reside in or rent out their properties. However, if your property has been occupied for at least 180 days in a year, you may be exempt from this tax.

It is also worth noting that detached residential homes with more than 3 self-contained “dwelling units” are automatically exempt from the Underused Housing Tax. Furthermore, if a detached home has at least 4 separate rentable dwelling units with private kitchen, bath, and living areas, it is exempt from the tax even if the rentals are less than one month at a time. However, this exemption only applies to detached homes and not to semi-detached homes, townhouses, or condos.

In summary, as a foreign seller, you need to consider the Underused Housing Tax when selling an underused or vacant property in Canada. If you are unsure whether this tax applies to your property, it is recommended that you seek professional advice from a tax specialist or lawyer.

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On this Remembrance Day, we pause to honor and remember the brave individuals who have sacrificed so much for our freedom and peace around the world.

In the midst of our own challenges, let's take a moment to appreciate the resilience and strength that has carried us through. It's a time to reflect on the importance of unity, gratitude, and the enduring human spirit.

Wishing you a day filled with reflection, gratitude, and the warmth of community.

Connect with me for a stellar referral to a mortgage expert who can make your pre-approval process a breeze! Your home journey starts here.

Jason Streich⁠
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October sales activity slowed over the last month in alignment with typical seasonal patterns. However, with 2,171 sales, levels were 17% higher than last year and amongst the highest levels reported for October. Sales activity has been boosted mainly through gains in apartment condominium sales as consumers seek affordable housing options during this period of high-interest rates.

New listings also improved this month compared to last year, reaching 2,684 units, reflecting the highest October levels reported since 2015. Despite the gain, relatively strong sales prevented any significant shift in inventory levels, which remain over 40% lower than levels traditionally available in October.

With a months of supply of one and a half months, we continue to experience upward pressure on home prices. The unadjusted benchmark price in October reached $571,600, a gain over last month and nearly 10% higher than last October.


Jason Streich⁠
Greater Calgary Real Estate⁠
403 807 2204⁠
jason@jasonstreich.com⁠

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Tenants and landlords may terminate a rental agreement for a variety of reasons, such as: the agreement was breached the tenant found another place to live the landlord wants to end the tenancy for a prescribed reason.

Ending a fixed term

A fixed term tenancy ends on the day specified in the rental agreement, unless both parties agree to an early termination. For example, if the fixed term is from January 1 to December 31, the tenancy automatically ends on December 31. Unless the tenant and landlord make other arrangements, the tenant has to move out by noon on December 31.

The landlord or tenant does not need to give notice to end a fixed term tenancy. It is courteous if the landlord or tenant provides a reminder before the end of the tenancy agreement.

Ending a periodic term

A landlord may end a periodic tenancy if:

• the landlord or a relative of the landlord wants to move in - ‘relative’ includes any relative by blood, marriage, adoption or adult interdependent relationship
   
• the landlord agrees to sell the rental premises, all conditions of the sales agreement have been satisfied or waived and the buyer or a relative of the buyer wants to move in
   
• the buyer must ask the landlord in writing to give the tenant a notice to end the tenancy
   
• the landlord intends to demolish the rental premises
   
• the rental premises are a detached or semi-detached dwelling or one condominium unit and the landlord agrees to sell the rental premises and all conditions of the sales agreement have been satisfied or waived
   
• in these cases, the buyer must ask the landlord in writing to give the tenant a notice to end the tenancy
   
• neither the buyer nor the buyer’s relatives have to occupy the rental premises
   
• the landlord is an educational institution, and the tenant was a student at the beginning of the tenancy but is no longer a student
   
• the landlord intends to use or rent the rental premises for a non-residential purpose
   
• If a landlord intends to do major renovations that require the rental premises to be vacant or the landlord intends to convert the premises to a condo unit, the landlord must give the tenant one year’s notice to terminate the periodic tenancy. Major renovations do not include painting, replacing floor coverings, or routine maintenance.

All the infomation published in this blog is from the Alberta Governments site https://www.alberta.ca/ending-rental-agreement.aspx

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