A non-resident of Canada sells an Alberta property. What specific tax obligations apply to this transaction?
Correct Answer
C) Without a Section 116 clearance certificate under the Income Tax Act, the buyer must withhold 25% of the gross price for CRA
When a non-resident of Canada sells Alberta real estate, Section 116 of the Income Tax Act requires the buyer (or their lawyer) to withhold up to 25% of the gross sale price and remit it to the CRA unless the seller obtains a clearance certificate. The non-resident seller must also file a Canadian tax return to report the disposition and pay any capital gains tax owing.
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Previous Question
A foreign national who falls within an exception to the federal ban on home purchases by non-Canadians and qualifies for no BC exemption from the additional tax buys a $900,000 residential property in Metro Vancouver. What is the TOTAL Property Transfer Tax payable, including the additional foreign buyers tax?
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A property in Vancouver sells for $1,200,000 to a Canadian citizen who is not a first-time buyer. What is the Property Transfer Tax owing?