Do I pay the Ontario Non-Resident Speculation Tax if I buy a home as a foreign national?
Yes, Ontario's Non-Resident Speculation Tax (NRST) is 25% and applies to foreign nationals, foreign corporations and taxable trustees who acquire land with one to six single-family residences. It is in addition to the general land transfer tax and applies across Ontario.
If any transferee is a foreign entity or taxable trustee, NRST applies to the full value of the consideration, not just that person's share, and every transferee can be liable. Exemptions exist for Ontario Immigrant Nominee Program nominees, protected persons and spouses of citizens, permanent residents, nominees or protected persons. Status must exist on closing day, and the exemptions do not apply if a taxable trustee is a transferee. Nominees and protected persons must also meet co-owner and 60-day occupancy conditions.
If you become a permanent resident within four years after the conveyance is registered, you can apply for a rebate within 180 days of becoming a permanent resident. You must occupy the home as your principal residence from within 60 days after registration. Whether you owe NRST, or qualify for relief, depends on your status and everyone on title, so confirm with a lawyer before closing.
Key takeaways
- The NRST is 25%, applies across Ontario, and is in addition to the general land transfer tax.
- If any transferee is a foreign entity or taxable trustee, NRST applies to the full value of the consideration and every transferee can be liable.
- Exemptions for nominees, protected persons and spouses depend on status existing on closing day.
- A buyer who becomes a permanent resident within four years after registration can apply for a rebate within 180 days of becoming a permanent resident.