The Underused Housing Tax (UHT) is an annual federal tax of 1% of the value of vacant or underused residential property in Canada, administered by the Canada Revenue Agency (CRA). It has been eliminated from the 2025 calendar year: no UHT is payable and no returns are required for 2025 and later years. However, returns for 2022, 2023 and 2024 are still required, and the penalties for not filing them still apply.
Selling a property? In our experience, CRA is now likely to review UHT filings for 2022–2024 when a property is sold, and penalties for unfiled returns are significant. If you have not filed, we recommend coming forward through the Voluntary Disclosures Program (VDP).
Who had to file (2022–2024)
- Individuals who were not Canadian citizens or permanent residents and owned residential property in Canada on December 31 — including people in Canada on study permits, work permits or visitor visas.
- For 2022, most Canadian private corporations, and partners and trustees of partnerships and trusts that owned residential property, also had to file, even if no tax was payable.
- From 2023, most Canadian-controlled corporations, partnerships and trusts are excluded and do not need to file. Corporations with 10% or more foreign ownership may still need to file.
A separate return is required for each property and each year. Owners who were exempt from the tax — for example, because the property was rented out or was a primary residence — generally still had to file to claim the exemption.
Deadlines and penalties
- Each return was due by April 30 of the following year, so any 2022–2024 return not yet filed is now late.
- The minimum late-filing penalty is $1,000 for an individual and $2,000 for a corporation for each return, plus percentage-based penalties and interest where tax is payable.
- For returns filed after December 31 of the following year, the penalty for certain exemptions is calculated as if the exemption did not apply — so penalties can be much higher than the minimum.
Voluntary Disclosures Program (VDP)
If you missed a UHT return, the VDP can provide relief from penalties and part of the interest. CRA accepts VDP applications for late UHT returns, even when no tax is owing. The earlier you apply — ideally before CRA contacts you — the more relief is available. We prepare the outstanding returns and the VDP application together.
Information needed to file
- Tax number: your Social Insurance Number (SIN). If you do not have one (for example, on a visitor visa), you need an Individual Tax Number (ITN) first, which requires certified copies of identity documents such as your passport.
- For a corporation: its Business Number (BN).
- Property details: the address, the municipal tax roll number, the property identification number (PIN) from your closing documents, and the assessed value from the final property tax bill for each year.
- Property use for each year (owner-occupied, rented, vacant, etc.), to determine whether an exemption applies.
Reference: CRA — Underused Housing Tax
If you have unfiled UHT returns or are planning to sell a property, contact us.