After You Leave: How to Report Rent from Your Canadian Home

Withholding on rent paid to non-residents, the section 216 return, NR4

Scott Tang, CPAUpdated 2026-11-052026 rules4 min read

You've left Canada and kept your Toronto home to rent out. Canadian rent received by a non-resident is by default subject to 25% withholding on the gross rent, which your tenant or your agent remits to the CRA every month. Most people choose to file a section 216 return: tax is calculated on the net rent (after interest, property tax, condo fees and so on), and any excess withheld can be refunded (how much depends on the calculation).

25%

Default non-resident withholding on the gross rent

NR6

File the NR6 in advance; only after the CRA approves it in writing can withholding be based on the expected net rent

Section 216

File a return on the net rent each year; get a refund of any excess or pay any shortfall

June 30 of the next year

With an approved NR6, the section 216 return is generally due by this date; but any balance owing is generally due earlier, by April 30 of the next year

Two approaches

Item	No election	NR6 + a section 216 return each yearRecommended
How withholding works	25% of the gross rent	Still based on gross rent until the CRA approves in writing; after approval, 25% of the expected net rent
Do you file a return each year?	No; the agent issues an NR4 at year-end	Yes, a section 216 return
Final tax	Simply 25% of the gross rent	Calculated on net rent at graduated rates, which is lower in many cases
Deadlines	Each month's withholding is remitted by the 15th of the next month	Section 216 return: by June 30 of the next year if an NR6 was approved; balance owing by April 30 of the next year; if you sold the property and have recaptured depreciation, the return is also due April 30

If you didn't file an NR6, you can still file a section 216 return within 2 years after the end of the year, so that tax is calculated on the net rent and the excess withheld is refunded.

Who does what

Your agent in Canada

Collects the rent

Withholds each month and remits it to the CRA

Issues the NR4 at year-end, by March 31 of the next year

If the agent doesn't withhold or remit, the agent is also liable

You (or your accountant)

File the NR6 in advance and find an agent

File a section 216 return each year

Get a refund or pay the balance

The section 216 return reports only your Canadian rent and has nothing to do with your income abroad

Which expenses can be deducted

Expense	Deductible on the section 216 return	Not deductible or restricted
Mortgage interest	✓	✕Principal is not deductible
Property tax, insurance, condo fees	✓	—
Repairs, management fees, agent fees	✓	—
Depreciation (CCA)	◐Can be claimed, but can't create a loss	—
Airfare back to Canada to check on the property	—	✕Generally not deductible

Mortgage interest

✅ Deductible on the section 216 return: ✓
🚫 Not deductible or restricted: ✕Principal is not deductible

Property tax, insurance, condo fees

✅ Deductible on the section 216 return: ✓
🚫 Not deductible or restricted: —

Repairs, management fees, agent fees

✅ Deductible on the section 216 return: ✓
🚫 Not deductible or restricted: —

Depreciation (CCA)

✅ Deductible on the section 216 return: ◐Can be claimed, but can't create a loss
🚫 Not deductible or restricted: —

Airfare back to Canada to check on the property

✅ Deductible on the section 216 return: —
🚫 Not deductible or restricted: ✕Generally not deductible

Points to watch

Make sure you have an agent
A non-resident who rents out property generally needs to appoint a Canadian-resident agent (a friend or a property management company will do) to handle withholding and reporting; if the tenant pays you directly, the tenant is responsible for withholding.
File the NR6 early
Generally before January 1 of the year or before the first rent payment; you need to file a new one every year.
Selling later
A non-resident selling a home needs a section 116 clearance certificate, and depreciation claimed while it was rented out is recaptured; see "Non-Residents Selling Canadian Property: The Clearance Certificate" in this series.
Principal residence years
Years after you leave in which the home is rented out generally can't count as principal residence years; work out the tax on a future sale before you leave.

How Sheng Qian CPA can help

Set up before you leave
Appointing an agent and preparing the NR6, all done before the first rent payment.
A section 216 return each year
We file on the net rent and claim back any excess withholding.
Calculations before you sell
Principal residence years, recaptured depreciation and the section 116 clearance certificate, worked out together. For prices, see "What Sheng Qian CPA Can Do for Newcomers and People Leaving Canada: Support on Arrival and on Departure" in this series.

Sources

CRA: Income Tax Guide for Electing Under Section 216 (T4144) · Form NR6

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.