Federal Underused Housing Tax - Update

The Underused Housing Tax Act was enacted with an effective date of January 1, 2022. Affected owners, who own residential property in Canada and do not fall into the category of "excluded owners," must file an annual UHT return with the CRA by April 30, 2023. However, the CRA announced a waiver of penalties and interest for UHT returns and payments received before November 1, 2023. Condominium corporations owning residential property may also be required to file the UHT return but may be exempt from paying the tax if all directors are Canadian citizens or permanent residents. Failure to file the return can result in fines of up to $10,000 for corporations. Condominium corporations are advised to seek professional advice and ensure compliance with UHT requirements during the tax season.