How Is Rental Income Taxed for a Non-Resident Landlord in Ontario?

A non-resident landlord with an Ontario rental generally has to think about two separate tax events: the rent collected each year and the tax on a later sale. How this applies to the rent you collect depends on your situation, so confirm it with an accountant before the first rent payment.

The sale rules are more specific. A non-resident who sells Canadian real property must notify the CRA no later than 10 days after the sale (section 116). To get a certificate of compliance, the seller generally pays or secures a flat 25% of the proceeds minus the adjusted cost base. If no certificate is issued, the buyer may become liable for tax on the seller's behalf, and for depreciable property such as a rental building the amount is 50%.

Your actual gain is worked out separately: it is the amount by which the proceeds exceed the adjusted cost base plus the costs of selling. For 2025, generally one-half of a capital gain is included in income. If the capital cost allowance you claimed earlier is more than the undepreciated balance in the class when you sell, the excess is added to income in full. Because the numbers interact, get advice before you list the property.