T1135 Foreign Property Reporting: What to Report and How the $100,000 Test Works

What has to be reported, how the cost threshold is calculated, assets you don't report, penalties for not filing

Scott Tang, CPAUpdated 2026-11-052026 rules6 min read

If, at any time in the year, a Canadian tax resident holds "specified foreign property" with a total cost of more than C$100,000, they must file Form T1135 with their tax return. It is not a tax — it is a report — but the penalties for not filing or filing late are significant, and failing to file can give the CRA more years in which to reassess you. The federal budget of November 5, 2026 proposes raising the threshold to C$200,000 (for taxation years ending after 2026 — for individuals, from 2027); this only takes effect once the legislation is passed.

$100,000

You must file if the total cost is more than C$100,000 (at any time in the year); the budget proposes raising it to C$200,000 from 2027 (not yet law)

$250,000

If the cost stays under $250,000 all year, you can use the simplified method; once it reaches $250,000 at any time, you must report item by item

First year exempt

Not required for the year an individual first becomes a Canadian resident

$25 a day

Late-filing penalty, minimum $100, maximum $2,500; separate, heavier penalties apply where the failure is knowing or due to gross negligence

What counts and what doesn't

Asset	Counts for T1135 Specified foreign property	Doesn't count Excluded
Bank deposits and wealth management products in China or Hong Kong	✓	—
A-shares, Hong Kong shares, US shares (whichever brokerage holds them)	✓Foreign shares held at a Canadian brokerage also count	—
Bonds of foreign companies, money lent to people abroad	✓	—
Property in China that is rented out or held vacant as an investment	✓	—
A home used by you or your family (including a vacation home for your own use)	—	✓Personal use
Foreign shares in an RRSP or TFSA	—	✓Assets in registered accounts don't count
Funds issued by Canadian fund companies that invest abroad	—	✓What you hold is a Canadian fund
Assets used exclusively in a business operated abroad	—	✓Used exclusively in an active business
Shares of a foreign company that meets the definition of a "foreign affiliate"	—	◐Not on the T1135; look at the T1134 instead (see "Shares in a Foreign Company: When Do You File the T1134?" in this series)

Bank deposits and wealth management products in China or Hong Kong

📋 Counts for T1135: ✓
🚫 Doesn't count: —

A-shares, Hong Kong shares, US shares (whichever brokerage holds them)

📋 Counts for T1135: ✓Foreign shares held at a Canadian brokerage also count
🚫 Doesn't count: —

Bonds of foreign companies, money lent to people abroad

📋 Counts for T1135: ✓
🚫 Doesn't count: —

Property in China that is rented out or held vacant as an investment

📋 Counts for T1135: ✓
🚫 Doesn't count: —

A home used by you or your family (including a vacation home for your own use)

📋 Counts for T1135: —
🚫 Doesn't count: ✓Personal use

Foreign shares in an RRSP or TFSA

📋 Counts for T1135: —
🚫 Doesn't count: ✓Assets in registered accounts don't count

Funds issued by Canadian fund companies that invest abroad

📋 Counts for T1135: —
🚫 Doesn't count: ✓What you hold is a Canadian fund

Assets used exclusively in a business operated abroad

📋 Counts for T1135: —
🚫 Doesn't count: ✓Used exclusively in an active business

Shares of a foreign company that meets the definition of a "foreign affiliate"

📋 Counts for T1135: —
🚫 Doesn't count: ◐Not on the T1135; look at the T1134 instead (see "Shares in a Foreign Company: When Do You File the T1134?" in this series)

The two items most often missed: US and Hong Kong shares held in a Canadian brokerage account, and a home in China that sits empty. With the first, many people assume that "if the account is in Canada, it isn't foreign" — but what matters is whether the asset itself is foreign.

How the C$100,000 is calculated

Cost, not market value
Use the purchase cost (converted to Canadian dollars); for assets a newcomer already owned before landing, the cost is the fair market value on the day you became a resident.
Add everything together
It's not that you report only when a single item is over $100,000 — it's the total cost of all your specified foreign property.
At any time in the year
If you were over $100,000 at some point in the year and under it by year-end, you still have to report.
Spouses count separately
For property held jointly, each spouse looks at their own share to see whether they are over the threshold.

Two ways to fill it out

Item	Simplified method (Part A)	Detailed method (Part B)
When to use it	Total cost under C$250,000 throughout the year	Total cost reaches $250,000 or more at any time in the year
What to fill in	Tick the types of property, enter up to three main country codes, and report the total income and gains or losses on disposition	For each applicable category, enter the name, country, amounts, income and gains or losses; which amounts are reported varies by category
Foreign shares at a Canadian brokerage	Included in the applicable property type and in the total income and gains or losses	Qualifying accounts can use Category 7 and combine holdings by country, reporting the maximum and year-end fair market value; the maximum can be the highest month-end market value

Whether you reach the filing threshold and the threshold for detailed reporting is still based on cost; the market values reported under Category 7 don't change the fact that the thresholds are measured by cost.

What happens if you don't file

Filing late
$25 a day, minimum $100, for up to 100 days — that is, $2,500 — even if the property earned no income at all.
Knowingly or with gross negligence
The penalties are heavier; where the failure is knowing or due to gross negligence and lasts more than 24 months, an additional penalty of 5% of the cost of the property can apply.
The CRA may be able to look back further
If income from specified foreign property was not reported and the T1135 was not filed, filed late or filed incorrectly, the reassessment period is extended by 3 years.

Points to watch

Filing T1135 is not the same as reporting the income
Interest, dividends, rent and gains on sale from foreign property still have to be reported in your tax return as usual.
Exempt in the first year, required from the second
You don't file for the year an individual first becomes a resident; from the second year on, apply the threshold. If you were a resident before and have come back, you can't use this exemption again.
Missed it in past years
You can consider fixing it through the Voluntary Disclosures Program (VDP); see "Unreported Foreign Income from Past Years? The Voluntary Disclosures Program" in this series.

How Sheng Qian CPA can help

Take stock of your assets first
We go through a checklist of your deposits, shares and property in China, Hong Kong and the US, and work out which ones count and what their cost is.
Filed with your tax return
The T1135 is done together with your annual tax return, so the income you report and the assets you report match.
Assess missed years first
For earlier years that weren't reported, we first look at the risks and the options for catching up; for fees, see "What Sheng Qian CPA Can Do for Cross-Border Families: From Tax Returns to Foreign Asset Reporting" in this series.

Sources

Disclaimer

This article is general information only and is not tax advice. Everyone's situation is different; please consult a CPA about your specific arrangements. Service fees are as set out in our written quote.