Section 216 tax return for rental income

Non-resident tax has to be withheld and remitted monthly to the Canada Revenue Agency at the rate of 25% on the gross rental income. The non-resident tax withheld is considered your final tax obligation to Canada on the rental income. 25% on gross rent is way too high considering that, very often, there is no or little profit to show after all kinds of expenses.

Fortunately, you can elect to file under section 216 to pay tax on net rental income instead of gross rental income and get a refund of the excess tax withheld. But don't wait too long. You have to file within two years.

There is an alternative way to pay the monthly withholding taxes. You can file Form NR6 to request tax be withheld on 25% of estimated net income instead on gross rental income. And you are required to file Section 216 return to report your rental activities each year otherwise penalty will be applied.

You can see Section 216 return should be filed either case.

We have been helping non-residents with their tax compliance since 2002. Leave the hassle of tax filing to us, and we will give you peace of mind and tax savings. Contact us today!

Other services for non-resident property owners

Certificate of compliance - Proccounting helps non-residents when selling taxable Canadian property

Other services

  • We also provide on-site bookkeeping service if you are in Greater Toronto Areas and you need bookkeeping to be done in your office. Read more...
  • High quality income tax return services for corporations, self-employed, individuals, and families.  Read more...
  • We provide bookkeeping services for law firms. Bookkeeping for legal industry requires special skills due to the complexity of trust accounts and the rules imposed by law society. We have a team of bookkeepers with the right skills and have been helping many lawyers over a decade. Read more...
  • CA firms partner with us to better serve their clients. Read more to find out how we can benefit each other.

Our mission and our promise

  • We strive to help small business owners stay focused on their core business activities to achieve their goals. Read more...
  • We stand behind our work. We provide life time support for each tax return we prepared. Read more...