Shortly before the filing deadline for the Underused Housing Tax (UHT), there was considerable uncertainty as to whether any action would still be required for the 2025 tax year in Canada. This uncertainty stems from the proposed legislation to repeal the UHT, which has not yet been formally enacted.
The Canada Revenue Agency (CRA) has now announced that, until further notice, it does not expect UHT filings or tax payments for the 2025 tax year or subsequent years.
For owners of vacant or underused residential property in Canada, this currently means:
- For 2025 and future years, there is no immediate obligation to file UHT returns.
It is important to note, however, that this position does not apply retroactively. The CRA has expressly confirmed that obligations for the 2022 to 2024 tax years remain in place.
- Any outstanding UHT returns for prior years must still be filed.
At the same time, a degree of uncertainty remains. The CRA has indicated that further guidance will be issued should the proposed legislation not come into force as expected.
Particularly in cross-border contexts, this development once again highlights that it is not only the current legal framework that matters, but also how quickly regulatory conditions in Canada can shift.
We continue to monitor developments closely and will provide updates as soon as concrete action becomes necessary.
Further background on the repeal of the UHT can be found in our related article:
Underused Housing Tax Eliminated
