Updated Checked by the Tax-Services.ca editorial team How we check
The underused housing tax does not apply for 2025 or any later year, so there is no UHT return to file for 2026 or in 2027. The CRA says owners do not need to file or pay for 2025 and later years. Returns and payment for 2022, 2023 and 2024 are still required.
What was the underused housing tax?
It was an annual federal tax of 1% on the ownership of vacant or underused housing in Canada, and it took effect on 1 January 2022. The CRA called the people who had to deal with it “affected owners”, and they had to file a return each year, even when no tax came out of it.
| Calendar year | Return and tax |
|---|---|
| 2022 | Still required |
| 2023 | Still required |
| 2024 | Still required |
| 2025 and later | No return and no tax for affected owners |
Do I still have to file for an earlier year?
If you were an affected owner in 2022, 2023 or 2024 and never filed, yes. The CRA’s notice on the proposed amendments to the underused housing tax says the requirement to file a return and pay the tax still applies to those three years. The end of the tax going forward doesn’t wipe them.
The same notice talks about relief on penalties. It describes cutting the minimum failure-to-file penalties to one-fifth of their old level, retroactive to 2022: for individuals from $5,000 to $1,000, and for other owners from $10,000 to $2,000. The notice words that as a proposal, so check the CRA’s UHT pages for the amounts that apply to you now.
What if you never filed a UHT return for 2022 to 2024?
Suppose you inherited a cottage in 2022 and nobody told you a return was needed. The deadlines are long gone: the CRA’s notice gave until 30 April 2024 for 2022 returns, and returns are generally due by 30 April of the following year. Late is still better than never. Gather the dates you owned the property, who used it and which exemption might have applied, then look at the CRA’s UHT page for the current way to file a late return and for any relief process. We couldn’t confirm a relief process for old years on the pages we read.
What would the tax have cost?
Arithmetic is easy at 1%. On a home valued at $800,000, the annual charge would be $8,000. On $1.5 million it would be $15,000. These are illustrations of the rate only, because we haven’t confirmed how the value was set under the rules, and exemptions could take the bill to zero.
For context, the same house has other yearly costs that never went away. The property tax calculator estimates the municipal bill, and the condo ownership cost calculator adds fees and utilities so you can see the full holding cost of a home that sits empty.
Is the empty home still costly to hold?
Yes. Even without the federal tax, a vacant property carries municipal tax, insurance, heat and upkeep. Your city or province may have its own vacancy rules too, and we haven’t checked any of them.
If you’re weighing whether to rent it out, the rental property calculator compares rent with costs. Rent counts as income, and the rental income tax calculator estimates what you’d owe on it.
Buying as a non-resident brings separate taxes at purchase, unrelated to the UHT. The non-resident buyer tax calculator covers those.
Who was an affected owner and who was an excluded owner for the UHT return?
The CRA notice on the proposed amendments describes two groups. An affected owner is someone who owned a residential property in Canada on December 31 of the calendar year and was not an excluded owner on that date. Every affected owner had to file an annual UHT return. Excluded owners did not have to file a return or pay the tax.
In the CRA's list, excluded owners include individuals who are citizens or permanent residents of Canada and own the property in their own right, as well as governments, registered charities, municipalities and corporations listed on a designated Canadian stock exchange. The same notice gives foreign nationals as examples of affected owners, along with Canadian citizens and permanent residents who held the property as a partner of a partnership that is not a specified Canadian partnership.
The notice also mentions an exemption for vacation properties, a new exemption for employee accommodations and reduced minimum failure-to-file penalties. Because it describes proposals from 2023 and 2024, use it for the background and check the CRA's current UHT pages for how a past return was treated.
Mistakes to avoid
Don’t assume the news covers you if you skipped an earlier year. It doesn’t.
Don’t rely on a website that still says the tax applies in 2025 or that describes “incentives”. Some of that is out of date, and the wording of the law changed in March 2026. Check the CRA page for the year in question.
And don’t throw out your records. If the CRA asks about 2022 to 2024, you’ll want the dates you owned the property, who lived there and any exemption you relied on.
Where this information comes from
The rate, the dates and the penalty changes come from the CRA‘s pages on the underused housing tax, including its notices on the 2025 changes and the proposed amendments, read on 30 September 2026. The dollar examples are our arithmetic, not CRA figures. We’re an independent site, and no government body is behind it.
Is there anything to file for 2026 or 2027?
No. The CRA's page, updated in March 2026, says affected owners do not need to file a return or pay the UHT for 2025 and subsequent calendar years, so there is no UHT return for the 2026 calendar year and none due in 2027. The Budget 2025 Implementation Act received royal assent on March 26, 2026, according to the CRA.
Holding an empty home still has costs. Our property tax calculator and condo ownership cost calculator estimate them, and the buying or selling a home guide covers the taxes at purchase. For the filing deadline of old returns see the missed filing deadline page.
Where we checked
The rate, the dates and the status for 2025 and later come from the CRA's notice on proposed amendments to the underused housing tax with its March 2026 update, which we read in November 2026. The CRA page describes the penalty cut as a proposal and does not confirm whether it was enacted, so check the CRA's UHT pages for the amounts that apply to you now. The dollar examples are our arithmetic. We are an independent site, and no government body is behind it.
Frequently asked questions
Do I have to pay the underused housing tax for 2025?
No. The CRA says affected owners do not need to file a return or pay the tax for 2025 and subsequent calendar years. That also means there is nothing to file for 2026 or in 2027. Keep your records for the earlier years in case the CRA asks.
Do I still owe it for 2022 to 2024?
The CRA says the requirement to file a return and pay the tax still applies to the 2022, 2023 and 2024 calendar years. If you were an affected owner and never filed, file those returns now. The end of the tax going forward does not wipe out earlier years.
What was the rate?
It was an annual federal tax of 1% on the ownership of vacant or underused housing in Canada, in effect from January 1, 2022. Affected owners had to file a return each year even when no tax came out of it, because exemptions had to be claimed on the return.
Were the late-filing penalties changed?
The CRA's notice describes cutting the minimum penalties to one-fifth, from $5,000 to $1,000 for individuals and from $10,000 to $2,000 for others, retroactive to 2022. The notice words this as a proposal, so confirm the current amounts on the CRA's UHT pages.
When did the change become law?
The CRA says the Budget 2025 Implementation Act, No. 1 received royal assent on March 26, 2026, and describes it as the act that carried the proposed changes to the Underused Housing Tax Act. Read the CRA's page for the exact wording that applies to your year.
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