The Non-Resident Speculation Tax (NRST) is a significant fiscal measure applied in Ontario to curb the inflationary impact of foreign investments on residential real estate prices. As of late 2022, the NRST stands at 25%, having seen a gradual increase from an initial 15% in earlier years. This tax applies to foreign entities and certain taxable trustees buying residential properties within Ontario.

Who is Exempt from the NRST?

Exemptions to the NRST are available under specific conditions, aiming to support individuals who contribute to the Canadian economy and society while transitioning towards permanent residency. The key exemptions include:

Permanent Residents: Foreign nationals who become permanent residents of Canada within four years from the date of their property purchase can apply for a rebate, provided they occupy the property as their principal residence for a set duration starting within 60 days of purchase.

Nominees: Individuals nominated under the Ontario Immigrant Nominee Program at the time of the property purchase are exempt, assuming they apply or plan to apply for permanent residency before their nominee certificate expires. The property must be intended as their principal residence.

Protected Persons and Spouses: These individuals are also eligible for NRST exemptions under certain conditions that align with their residential and legal status within Canada.

The criteria for these exemptions require thorough documentation and adherence to specific occupancy and application timelines. It’s essential for prospective buyers who might qualify for these exemptions to consult with real estate lawyer to navigate the complexities of the NRST effectively.

For more detailed information on NRST and its exemptions, you can visit the official Ontario government website or consult tax advisory resources like PwC’s insights on the tax’s implications and recent changes​ (PwC)​​ (Toronto.ca)​.