3 Major Canadian Tax Laws You Should Know If You Do Real Estate Investment in Canada

Monday Mar 09th, 2020


Real Estate investment in Canada is really easy. You can invest in rental properties, you can buy your own farm house or you can own a villa, all you need to keep in your mind are the 3 most prominent Canadian tax laws that applies to all the types of real estate investment in Canada that you do no matter when. If you are investing, you have to follow these laws otherwise you might suffer through some legal procedure in future.

Everybody have a plan in their mind to buy properties so that they never have to struggle for getting a shelter for themselves when it is an emergency and Canada is a country that has a good scope for investors who are willing to invest in properties.

If you have a deep knowledge about the real estate investment in Canada, then it is a hip-hip hooray for you but if you have zero knowledge about the process of real estate investment in Canada and its Canadian laws then you really need to go through this guide.

Canadian Law Taxes Rules for Real Estate Investment:

  1. Rental Property Taxes:

When you do real estate investment in Canada, it doesn’t matter whether you are a Canadian citizen or you belong to other country. The rental property taxes rule says that it is mandatory to pay 25% of tax from the gross pay earned from the total rental income. However, if you are not a local citizen of Canada, you can choose to pay the 25% of tax by filling up the NR6 form.

  1. General Property Taxes:

The general property includes flats, duplexes, farm houses, villas or any commercial space that you are owning. Whenever you buy a brand-new property or a pre-owned property, you have to pay a transfer tax. In this tax, the tax amount is different depending upon the province. Yet, there are some other rules written for those who buy a property in Canada for the very first time. Also, as it is a municipal tax, even few other taxes are included in this.

  1. Selling A Canadian Property that You Own:

This information is specially for those who are non-residents in Canada but have done real estate investment in Canada. When ever you sell a property that you own, it is the right of the government of Canada to take 50% of the amount as a withholding tax and you cannot save yourself from paying this tax.


These Canadian laws are not very strict but it is important that whenever you do real estate investment in Canada or in any other country you are aware with the tax laws of that specific country so that you do not put yourself into the well of legal troubles.

We hope this guide helped you to know gain an idea about the Canadian laws on real estate investment in Canada. Share and gain knowledge!

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