What happens if I filed an NR6 that was approved by the CRA but I did not file the section 216 return by the deadline of June 30th?
Allan Madan, CA
By way of background, the Section 216 Tax Return reports the net rental profits (i.e. revenues – expenses) earned on an Canadian rental property, which is owned by a Non-resident of Canada. The NR6 Form is a waiver that reduces the withholding tax rate of 25% on gross rents received by the landlord to only 25% of the net rental profits (i.e. revenue – expenses) earned by the landlord.
According to the Canada Revenue Agency, if you fail to file the section 216 return by its due date (June 30), you will have to pay non-resident withholding tax of 25% on the gross rental income. The moral of the story is: Do not file the Section 216 Tax Return past the due date!
Disclaimer
The information provided on this page is intended to provide general information. The information does not take into account your personal situation and is not intended to be used without consultation from accounting and financial professionals. Allan Madan and Madan Chartered Accountant will not be held liable for any problems that arise from the usage of the information provided on this page.
ABOUT THE AUTHOR
ALLAN MADAN
CA.CPA.CGA
Allan Madan is a CPA, CA and the founder of Madan Chartered Accountant Professional Corporation. Allan provides valuable tax planning, accounting and income tax preparation services in the Greater Toronto Area.
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