Updated October 2026 | Canadian Tax Guide
Canada’s Underused Housing Tax (UHT) is no longer required for 2025 and future years. For property owners who have been following the changing rules, that’s welcome news.
But what if you owned a condominium, house or rental property in Canada between 2022 and 2024 and never filed a UHT return?
You may still have an outstanding filing obligation, even if your property was rented and no tax was payable.
This is particularly important for non-resident property owners, who sometimes assume that filing a Canadian rental income tax return covers all their Canadian tax obligations.
It doesn’t necessarily.
Here’s what property owners need to know.
1. The UHT Has Ended, but Previous Years Still Matter
Introduced in 2022, the UHT was an annual federal tax generally targeting vacant or underused residential properties owned by non-Canadians.
Where applicable, the tax was generally calculated at 1% of the property’s taxable value, adjusted for the owner’s ownership percentage.
On March 26, 2026, Bill C-15 received Royal Assent, ending UHT filing and payment requirements beginning with the 2025 calendar year.
The change does not cancel outstanding obligations for earlier years.
| Calendar Year | UHT Filing and Payment Requirements |
|---|---|
| 2022 | May still apply |
| 2023 | May still apply |
| 2024 | May still apply |
| 2025 | No longer required |
| 2026 and later | No longer required |
The distinction is straightforward: the UHT has ended prospectively, but historical compliance still matters.
The Canada Revenue Agency (CRA) confirms this on its official Underused Housing Tax information page.
Not Sure Whether You Have Outstanding UHT Returns?
If you owned Canadian residential property during 2022–2024, Proficiency Tax can help determine which years, if any, require a return.
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2. Who Was Required to File?
Not every Canadian property owner was required to submit a UHT return.
The filing rules distinguished between two categories:
Excluded owners: Generally, these owners were not required to file or pay UHT. Most Canadian citizens and permanent residents who owned residential property personally fell into this category.
Affected owners: These owners generally had to file a return for each applicable residential property, even if they qualified for an exemption from paying the tax.
Affected owners could include non-Canadian individuals, certain corporations, trustees and partners of partnerships.
There is another important detail: the rules changed between 2022 and 2023.
Legislative amendments expanded the definition of an excluded owner beginning in 2023. As a result, some owners who had to file for 2022 no longer had the same obligation for 2023 or 2024.
For this reason, filing status should be reviewed separately for each year rather than assuming that one answer applies to the entire period.
The CRA explains these distinctions in its guidance on who must file and pay UHT.
3. Does a Rented Property Qualify for an Exemption?
This is one of the most important questions for non-resident landlords.
A residential property that was rented to a qualifying occupant may have been eligible for an exemption from paying UHT.
For example, certain qualifying occupancy arrangements required the property to be occupied for at least 180 days during the calendar year, calculated using qualifying occupancy periods of at least one month.
However, meeting the conditions for an exemption from payment did not necessarily remove the obligation to file a return.
In other words, an owner could owe $0 in UHT and still be required to file Form UHT-2900.
The exemption rules are fact-specific. The rental agreement, the occupant’s relationship to the owner and the duration of occupancy may all be relevant.
4. Example: A Non-Resident Landlord in Ottawa
Consider Sarah, a hypothetical property owner who lives outside Canada.
Sarah owns a condominium in Ottawa that was rented to a tenant throughout 2024. She has been reporting her Canadian rental income and assumed that she had met her Canadian tax obligations.
She never submitted a UHT return because the property was not vacant.
But if Sarah was an affected owner on December 31, 2024, she generally had a separate UHT filing obligation.
Her rental arrangement might qualify for an exemption from paying the tax, provided the relevant conditions were met.
The important point is that her rental income tax filings and UHT obligations are separate.
This is why reviewing a property’s actual ownership and occupancy history is more useful than simply asking whether it was rented.
For help with related Canadian rental income reporting, see our Non-Resident Tax Services.
5. What Happens if You Missed a UHT Filing Deadline?
Late UHT returns can result in penalties even when no UHT was ultimately payable.
The amended minimum penalties for failing to file a required return are:
| Affected Owner | Minimum Penalty |
|---|---|
| Individual | $1,000 |
| Corporation | $2,000 |
These are minimum amounts, not necessarily the total penalty that may be assessed.
The calculation can depend on the length of the delay, the tax otherwise payable and whether specific exemption-related penalty rules apply.
Interest may also apply to unpaid tax.
A property owner should therefore avoid assuming that a tax exemption automatically means there is no financial exposure from an unfiled return.
Have You Received a CRA Notice or Discovered a Missing UHT Return?
Proficiency Tax can review the outstanding years, determine which returns are required and assist with the next steps.
Request Assistance With Late UHT Returns
You can also explore our CRA Tax Help services.
6. How to Review Your Outstanding UHT Obligations
If you are uncertain about your filing history, start with the information that determines whether a return was required.
Step 1 — Identify the owner
Confirm who owned the property on December 31 of each relevant year. Ownership through a corporation, trust or partnership may require additional analysis.
Step 2 — Determine the filing status
Establish whether the owner was affected or excluded under the rules applicable to 2022, 2023 and 2024.
Step 3 — Review property use
Gather leases, occupancy dates and other records needed to assess available exemptions.
Step 4 — Identify missing returns
Determine whether Form UHT-2900 is required for each property and year. Multiple affected owners may have separate filing obligations.
Step 5 — Review penalties and possible relief
Calculate any potential amounts owing and consider whether a request for penalty or interest relief is appropriate.
Completing this review before filing helps reduce the risk of submitting unnecessary returns or overlooking an important exemption.
7. Frequently Asked Questions
Is Canada’s Underused Housing Tax completely cancelled?
UHT filing and payment requirements have ended for 2025 and subsequent calendar years. Requirements for 2022, 2023 and 2024 remain applicable.
I rented my property. Do I still need to file?
Possibly. Qualifying rental occupancy may provide an exemption from paying the tax, but affected owners generally still had to file.
What if I own more than one residential property?
An affected owner generally had to file a separate return for each applicable residential property.
Can I still file a missing UHT return?
Yes. Historical UHT returns can still be submitted. Potential penalties and interest should be reviewed.
Does the UHT cancellation also eliminate municipal vacant-home taxes?
No. Municipal and provincial property-related taxes operate separately from the federal UHT.
Final Thoughts: Check Before Assuming Your UHT Obligations Are Over
The end of the UHT is a welcome change, but it does not necessarily close the file for property owners who had obligations between 2022 and 2024.
If you owned residential property in Canada during those years, a review of your filing status may reveal that no action is required — or that outstanding returns should be addressed.
Need Help With Historical UHT Returns?
Proficiency Tax assists Canadian and non-resident property owners with Canadian tax compliance, including outstanding Underused Housing Tax returns.
Whether you need a filing-status review, an exemption assessment or assistance with overdue returns, contact us to discuss your situation.
Request a UHT Tax Assistance Quote
Email: [email protected]
Phone: (800) 984-7418
Website: https://proficiencytax.com
Official References
Disclaimer: This article provides general Canadian federal tax information as of October 2026 and does not constitute personalized tax advice. Filing requirements, exemptions and penalties depend on the facts of each case.