Owners of residential property in Canada now have until April 30, 2024 to meet their tax filing obligations under the Underused Housing Tax (UHT) rules for the 2022 calendar year. As a reminder, certain Canadian private companies (including bare trustee corporations) and individuals, as well as non-resident, non-Canadian owners, have to file an annual return for specific types of residential property they owned on December 31, 2022, and also determine whether they are liable for a 1% annual UHT on that property. The CRA has now announced that it will waive penalties and interest for any late-filed 2022 UHT return and for any related late-paid UHT, provided the affected owner files any required returns and pays any related UHT by April 30, 2024. Previously, the CRA said it would only provide relief until October 31, 2023 for affected owners who would have otherwise been required to file these returns by April 30, 2023.
The CRA’s announcement, which was made on October 31, 2023, provides some welcome relief for affected residential property owners who were unable to meet the previous extended deadline. However, these owners should still act quickly to comply with these rules before April 30, 2024 so they do not face significant penalties, even where a return is required, but no tax is ultimately payable. The CRA has effectively extended the filing deadline for the 2022 returns to coincide with the deadline to file 2023 UHT returns. As a result, affected owners who have not yet filed their UHT returns for the 2022 calendar year will now have to file their UHT returns for both the 2022 and 2023 calendar years and pay any related UHT by April 30, 2024.
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