Non-Resident Speculation Tax Increasing March 30, 2022
As part of its commitment to tackle Ontario’s housing crisis by prioritizing Ontario families and homebuyers, the government is increasing the Non-Resident Speculation Tax rate to 20 per cent, closing loopholes to fight tax avoidance and expanding the tax to apply provincewide effective March 30, 2022.
The changes made to establish the tax as the most comprehensive in Canada were announced as the government prepares to unveil the next components of its housing supply action plan designed to build more homes in Ontario.
Currently, the Non-Resident Speculation Tax rate is 15 per cent and only applies to homes purchased in the Greater Golden Horseshoe Region by foreign nationals, foreign corporations and taxable trustees. Increasing the tax rate to 20 per cent and expanding the tax to apply provincewide will strengthen efforts to deter non-resident investors from speculating on Ontario’s housing market and help make home ownership more attainable for Ontario residents.
The Government of Ontario is eliminating loopholes to support Ontarians who are trying to buy their first home by focusing NRST relief eligibility to only newcomers who commit to laying down roots in the province long-term.
Rebates for foreign nationals who become permanent residents of Canada within four years after the tax became payable remain available. Similarly, exemptions for nominees under the Ontario Immigrant Nominee Program, protected persons (refugees), and spouses of individuals not subject to the Non-Resident Speculation Tax remain available, if eligibility criteria are met.
Rebates to international students and foreign nationals working in Ontario are no longer available for binding agreements of purchase and sale entered into on or after March 30, 2022.
The news release from the Ontario government is available here and more information on the tax is available here.
This information was taken from the News release “Ontario Cracking Down on Foreign Real-Estate Speculation with the Most Comprehensive Non-Resident Speculation Tax in Canada” published on the Ontario.ca website on March 29, 2022.
