CRA’s Proposed Amendments to Underused Housing Tax Act

In November 2023, the Canada Revenue Agency (CRA) posted draft legislation to amend the Underused Housing Tax Act with provisions retroactive to January 1, 2023.

Some of the key proposed changes include: 

• Definition of an excluded owner expanded to include:
  • Trustee of a trust that is a specified Canadian trust
  • Partner of a partnership that is a specified Canadian partnership
  • Specified Canadian corporation
  • Canadian subsidiary of certain trusts or corporations
• Definition of specified Canadian partnership and specified Canadian trust. Each of its members is:
  • a person who is an excluded owner
  • another partnership or trust of which each member or beneficiary is an excluded owner
  • a trust that is an excluded trust as referred to in any of subparagraphs (a)(ii) to (iv) of that definition
• Non-resident (not a citizen or permanent resident of Canada) owner in multiple capacities:
  • Clarification where an individual is an owner in their individual capacity and as a trustee. They may be excluded in their capacity as a trustee of a specified Canadian trust, but not as an individual. 
• Reduction of minimum penalties for failure to file:
  
  • $1,000 for individuals (formerly $5,000)
  • $2,000 if not an individual (formerly $10,000)

The federal government invites Canadians and stakeholders, including Indigenous governments, organizations and associations, to share their feedback on these proposed changes by emailing Consultation-Legislation@fin.gc.ca by January 3, 2024.

For more information, read the CRA's page on Legislative and Regulatory Proposals Relating to the Underused Housing Tax Act and Explanatory Notes.