Underused Housing Tax 2026: Who Must File and New Exemptions

Key takeaways

• The Underused Housing Tax (UHT) is a 1% annual tax on the value of vacant or underused residential property owned by non-Canadians
• Many Canadian owners must still file a UHT return even if they owe no tax
• The 2026 filing deadline for the 2025 UHT year is April 30, 2026
• New exemptions added since launch reduce the filing burden for some Canadian owners
• Penalties for failure to file start at $5,000 for individuals, $10,000 for corporations

The Underused Housing Tax has been in place since 2022, but many Canadian owners of residential property are still unaware that they may need to file a UHT return even when they owe no tax. The CRA has updated its guidance for 2025 UHT filings, due April 30, 2026.

Who must file

Non-Canadian owners of residential property in Canada must always file. Canadian owners who are not "excluded owners" must also file, even if an exemption applies. Excluded owners — Canadian citizens, permanent residents, and most Canadian corporations owning properties directly — do not need to file.

Who is not an excluded owner: Canadian corporations with 10% or more non-Canadian ownership, Canadian partnerships where any partner is not a Canadian citizen or permanent resident, and trustees of trusts where any beneficiary or settlor is not a Canadian citizen or permanent resident. If this describes you, you must file a UHT return for every residential property you own in Canada as of December 31 of the UHT year.

New exemptions for 2025

The Department of Finance expanded UHT exemptions effective for the 2023 and later UHT years. Notably, properties used as a qualifying occupancy (rented to arm's-length tenants for at least 180 days, or occupied by the owner or qualifying family member as a primary place of residence) are exempt from the 1% tax. The expanded exemptions include vacation properties in eligible rural areas, newly constructed properties, and properties in specified vacation property areas.

How to file

File Form UHT-2900 for each property and each owner. If you and your spouse jointly own two properties and neither of you is an excluded owner, you each file two returns — four returns total. The form is filed through CRA My Account, Represent a Client, or by paper mail to a designated CRA tax centre.