Author: Supriya Chadha

The Non‑Resident Speculation Tax (NRST) is a tax on the purchase or acquisition of an interest in residential property located in the Greater Golden Horseshoe Region (GGH) by individuals who are not citizens or permanent residents of Canada or by foreign corporations (foreign entities) and taxable trustees.

The NRST applies in addition to the general Land Transfer Tax (LTT) in Ontario.

The 15 per cent NRST applies to the value of the consideration for a transfer of residential property if any one of the transferees is a foreign entity or taxable trustee.

PROPERTIES SUBJECT TO NRST

It applies to the transfer of land which contains at least one and not more than six single family residences.

The NRST does not apply to

• Multi‑residential rental apartment buildings with more than six units,
• Agricultural land
• Commercial land or Industrial land.

The NRST applies on the value of the consideration for the residential property. If the land transferred includes both residential property and another type of property, the NRST applies on the portion of the value of the consideration attributable to the residential property.

WHO IS EXEMPTED?

• Nominee– A foreign national who is nominated under the Ontario Immigrant Nominee Program (nominee) at the time of the purchase or acquisition, and the foreign national has applied or certifies that they will apply to become a permanent resident of Canada
• Protected person– A foreign national on whom refugee protection is conferred (protected person) under section 95 of the Immigration and Refugee Protection Act (Canada) at the time of the purchase or acquisition

 Spouse– A foreign national who jointly purchases residential property with a spouse, who is a Canadian citizen, permanent resident of Canada, nominee or protected person.

REBATES

A rebate of the NRST may be available in the following situations:

• The foreign national becomes a permanent resident of Canada within four years of the date of the purchase or acquisition
• The foreign national is a student who has been enrolled full-time for a continuous period of at least two years from the date of purchase or acquisition in an “approved institution” (under section 8 of Ontario Regulation 70/17 of the Ministry of Training, Colleges, and Universities Act) at a campus located in Ontario.
• The foreign national has legally worked full-time under a valid work permit in Ontario for a continuous period of at least one year since the date of purchase or acquisition.

To qualify for a rebate, the foreign national must exclusively hold the property, or hold the property exclusively with his or her spouse. The property must also have been occupied by each transferee as their principal residence for the duration of the period that begins within 60 days after the date of the purchase or acquisition.

If you have any concerns regarding whether the NRST is applicable to your circumstance or you would like help with a rebate, please feel free to Contact Us.

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