Canada Non Resident Tax Filing For Rental Properties Explained Using The NR6 Form Tutorial

[@iqbalanwer481]

Do a video on NR4 as well please. I know you have not done it yourself before.

[@realestategame]

I will be making one for the NR4 in the near future. If you haven't filed it yet you're late.

[@mouhanadkhoulani860]

this very helpful, can you please explain what we should do at the end of year, how we can file the tax for this income, i have asked some accountant and they do not know

[@realestategame]

You should find an accountant that knows how to do this as they will need to file your taxes at the end of the year and this will be a part of that process. You can find more information at this website www.canada.ca/en/revenue-agency/services/tax/international-non-residents/information-been-moved/rental-income-non-resident-tax/filing-reporting-requirements.html

[@mouhanadkhoulani860]

@@realestategame thank you 🙏🏻

[@manishmago9109]

Very informative and excellent explanation . I could complete the documents as you were explaining . Thanks for step by step guide with lot of patience and clarity

[@realestategame]

You're welcome I'm glad you found it useful. This is quite the process so I'm glad you were able to follow along.

[@KyungHeeChung-o9k]

Thank you so much. It was vey helpful!

[@realestategame]

Glad it was helpful!

[@kcsaswin]

Fantastic Video. Thank you for demystifying this for us!

[@realestategame]

Our pleasure!

[@jackykumar9822]

On what factors it depends if NR6 will be approved or not. What are the factors that could result in acceptance or rejection? Excellent information!!

[@realestategame]

I'm not sure of what factors specifically because I've never heard of anyone being rejected before. It's a pretty straight forward application so I don't see why you would be rejected. It doesn't matter really because at the end of the year when you file your taxes it will all be reconciled and any taxes owed or refunds will be calculated at that time. You can call CRA directly to see if they can give you scenarios where it could be rejected.

[@gddrak8839]

wow very patient and step by step detailed explanation. Thanks. Very helpful!

[@realestategame]

You're welcome I'm glad you found it helpful.

[@rejoice3443]

Great tutorial.

[@realestategame]

Thanks.

[@federicolucena3753]

Wow super helpful. Your are the man! Do you have a video or an example on how to fill out an NR4? Thanks!!!!

[@realestategame]

I appreciate that you've found this video helpful. I haven't personally filled out an NR4 before so I'm not to familiar with this. I'm sure there is a video somewhere on KZbin that could help you with this.

[@hamash2289]

Very very helpful 👏 Can you also explain how the NR4 filing should be done by the agent?

[@realestategame]

You're welcome I'm glad I can help. I'm not sure what your question is. If the agent follows this video exactly they will be able to do the non-resident filing for you. Can you be more specific on what exactly you would like to know?

[@hamash2289]

@realestategame Thank you for reaponding 🙏 I am going to ask a family member to be my agent so I wanna prepare the NR4 for them as well during tax season. Maybe I missed it in the video but didn't see any NR4 forms.

[@realestategame]

@@hamash2289 Ok that's perfect. They need to apply for the Non Resident Tax Number on your behalf and then file. They should follow the steps in the video NOT you. You just need to watch the Making a Payment chapter to file your NR4. I'm doing a digital filing and not using the form.

[@brianhouston1941]

@@hamash2289first the deadline is dependant on the nature of the income (rental, interest, dividend) etc, the NR4 is what was paid to the non resident and it would have the amount separated from the withholding tax. A copy needs to be distributed as per guidelines Then there is the impact of any bilateral tax treaty or convention which takes precedence over the income tax act such that the rate of withholding may be reduced. Depending on the nature of the income you can elect section 216 and claim expenses and net difference between what was remitted and actual expenditure. All the best

[@k7n9]

Phenomenal explanation!! For having more than two properties, do you just attach an extra paper showing the total? I am using my brother as my agent, does he have to fill an NR4 form ?

[@realestategame]

Yes in my example I did 2 properties as well so you can follow my video. Yes you can use your brother or wife as your agent. Yes your brother needs to get the non resident tax number then file the NR6 then file the NR4’s.

[@briantian]

This is a great intro, very helpful, thank you!!

[@realestategame]

You're welcome. I'm glad I was able to help.

[@KyungHeeChung-o9k]

👍

[@karimkhan9941]

Thanks for the amazing tutorial. I truly appreciate the flow from start to finish as it was easy to follow and absorb. I just have one question about the non-resident tax account, I noticed that you can open an account as a "Non-resident payee" while in your example you created an account with owner role "Withholding agent". Under what cases should a "Non-resident payee" account be created?

[@realestategame]

That's a good question. I've never really thought about this before and I'm not a tax accountant so take my opinions with a grain of salt. If this is important to you I'd call CRA to find out directly. I would assume that you'd select the "Non-resident payee" if you were the actual non-resident who wanted to create a Non-resident tax account. I would assume you'd have created this for other tax scenarios out of my scope of expertise. Perhaps to directly pay the full 25% of the GROSS taxes payable rather than having a withholding agent who has the option of paying only 25% of the NET taxes payable with the approval of the NR6.

[@AbcAbc-ii8zm]

I just spoke to CRA and you can actually pay WHT on gross rent using this account and it is not compulsory to have an agent. This is the option I use

[@karimkhan9941]

@@AbcAbc-ii8zm thanks, this is what I’m doing currently as well.

[@EmJel-wd1fo]

Such a helpful video! Thank you!!! How long did it take you to get the NR6 approved?

[@realestategame]

I submitted my NR6 late on Jan 11, 2024 and it wasn't approved until Mar 12, 2024 so about 2 months. Ideally you should submit this before the end of the year. The CRA suggests submitting it in October so that it get's process right away in January. They do it in order of which it is received.

[@EmJel-wd1fo]

@@realestategame Wish I looked into this earlier. I'll be closing next week. Do you know what the right process/steps to take while you're waiting for the NR6 to get approved? Thank you so much for your response and the video. Tremendous help!!

[@realestategame]

@@EmJel-wd1fo You can search me online and contact me directly. I will discuss this over the phone with you as it's a longer conversation that will take too much time explaining through text.

[@MJat-de8xo]

Very helpful video Tim. Thank you. I'll be grateful if you can answer this question: Is it compulsory for a non-resident to file taxes if they only have a rental income for which the withholding tax has been paid?

[@realestategame]

I'm not 100% clear on your question. As a non-resident you MUST pay taxes on your rental property no matter what. You can choose to pay 25% of the GROSS in which I don't think you need an agent or 25% of the NET where you need to follow the process in this video. I hope that answers your question.

[@adaflores5037]

Is very helpfully for me !!! Thanks !!!

[@realestategame]

I'm glad you were able to find the video helpful.

[@CiCiWithJoey]

Thank you for your detailed explanations step-by-step. Just have one question right now, who should send out my NR6 form and expense statement to CRA for me? My property manager or my accountant or myself? Thanks.

[@realestategame]

You're welcome. You can have anyone do this for you. Some property managers will offer this service so you will need to check with your property manager to see if they do. It might be at an extra charge. Your accountant can also do this again it might be an extra charge. You can also do this yourself free of charge.

[@hamash2289]

once again thank you for this life saver. One question about the "period end" filed in the payment. Shouldn't that be the end of the year we are paying the tax for? For example if paying for the whole year today May 24th 2024, what should be period end, Dec 2024?

[@realestategame]

You have to pay the tax every single month unless you have a nil remittance balance. Does that answer your question?

[@hamash2289]

@realestategame thanks, my question is can I pay for the remainder of the year at once?

[@realestategame]

@@hamash2289 I think you may be able to do this but you should call CRA to confirm. I've made over payments in the past and they did use the overpayment towards the payments for the year. You can call them at 1-855-284-5946

[@realestategame]

I just spoke to CRA and you can pay the entire year at once. Once you make this payment you'll need to do one more step. A few days after you make the payment you need to call CRA and tell the agent that you've paid for the whole year and they will adjust this on their end.

[@somneonfs]

Thanks a lot for this video. This will save me so much headache, as I am becoming a non-resindent in April. QQ though: 1. So this process needs to be done by my withholding agent, who will actually be my realtor in this case. The banking details entered in first section is the account of the agent or non resident or does it matter? Can I just open a new bank account and use that with my agent to collect rent and pay the withholding tax? 2. Also, at the end of the year when I am filing my taxes as a non-resident, this is all done by me in my own CRA account right? My agent does not need to do anything at that point? 3. Also, do initiate this process, I need to have all the properties rented already right? Asking as I will be renting my current house starting April, so I am guessing I cant start this process right now. Thanks a lot again.

[@realestategame]

1. Yes your Realtor will have to create an account as a withholding agent. If you see the my payment section you can see that anyone can make a payment for this account. You just need to have the account number. When I used to do this for my clients I usually had my clients pay me in advance and then I paid the account right after. However, you can do it whatever way you choose. 2. Yes you have to file your own taxes your agent will have nothing to do with that. Your agent has to file the NR6 for next year so that you only have to remit 25% of the net profits. 3. You must start this process as soon as you became a non-resident. If you're late to file you should contact your accountant to see how you can take care of the previous taxes. You should do this sooner than later. I wouldn't leave it longer than it should because you might have to pay penalties and interest. I hope this helps answer some of your questions.

[@somneonfs]

@@realestategame Thanks a lot for the reply. 1. So my agent can just pay the withholding tax from his account, all he needs is the NR agent number? He is basically just a proxy in this case that CRA can go after if I dont pay. Can he submit the application to get this number before I become a non-resident or does it have to be after? 2. So NR6 needs to be files every year by my agent? 3. When you say I should start this process sooner, I am not sure if I can start this before I have officially become a non resident. Lets assume I know I am gonna leave Canada on April 1st. In this case, when can my agent apply to be a NR agent for me? Also, can he submit the NR6 immidietly after or does he need to wait for the NR agent confirmation letter in the mail before he can fill and submit NR6?

[@realestategame]

@@somneonfs 1. Yes that is correct. The CRA will go after him as you're not in the country anymore. I believe he can apply before. As you saw from the video it gives you a number right away. 2. Yes the NR6 has to be renewed every single year. Best time to do it is in Dec or Jan. Before tax season as they get busy at the CRA. 3. If you're leaving on April 1st I would get it started early so that when you leave you already have your NR6 approved so you're not paying 25% of the gross. He can only submit the 25% of net once he gets the NR6 approved.

[@somneonfs]

@@realestategame I see. I think for NR6 I will need to wait till I know what price my primary residence will be rented for unfortunately. Can't fill it before that :(

[@realestategame]

@@somneonfs yes that is true you'll need to know the rent price to do the worksheet.

[@teresadexter4230]

Is that possible to file the NR4 ourself ?

[@realestategame]

If you are a non-resident you can file your taxes by yourself. However, you'll have to pay 25% of the Gross Rents every month and then get it back at the end of the year by filing a section 216. If you want to pay 25% of Net Rents you must designate an agent to do this. I believe that the tax man does this to have a resident of Canada to go after in case you don't pay your taxes. If you don't pay the agent is 100% responsible.

[@hadiakkad9149]

Hey Tim , very insightful, thank you , a question, can the non resident as an ages for himself without having to assign an agent ? If yes what will be subsequence for the other format flow need to be filled ?

[@realestategame]

No you must designate a Canadian Resident as an agent.

[@Drewbie96]

Thank you so much for this!!! If we do have the mortgage statement (incl interest and principle breakdown), can we put the most recent month's interest payment?

[@realestategame]

I'm not quite understanding your question but if I were to rephrase it are you asking if you could use your last months interest payment to calculate it for the year? The short answer is you can put down whatever numbers you want to get the approval. You'll have to report your final numbers on your tax filing at the end of the year. Therefore the numbers will be adjusted accordingly. So yes you can just put the last months interest payment and then multiply it by 12 so you get the year then use this number to reduce your rental income so you can get the approval to pay only the 25% of net rent. Then at the end of the year you adjust it with the real numbers when you get your final mortgage statement with the actual interest numbers. I hope that answers your question.

[@TA-ql9hb]

If the properly is owned by husband/wife (both non-residents) then should the withholding agent submit two NR6? Also, would the withholding agent have one NR account and list both of them as two separate owners? Finally, the rental income and expenses would be 50-50 for both husband and wife individual filing?

[@realestategame]

This is a good question. I can find out the answer to your question by calling CRA tomorrow morning and letting you know.

[@realestategame]

I just spoke to CRA and you have to file 2 NR6's and another 2 NR4's for the year. However, you'll only pay into your 1 account so you wouldn't need to make 2 payments just one. At the end of the year when the husband/wife claims their taxes the accountant will take care of the rest.

[@TA-ql9hb]

@@realestategame Thank you!

[@mohitarora4485]

Very good and informative video. Can you share the excel sheet so we can reuse it

[@realestategame]

Appreciate the feedback. I've added the link to the spreadsheet in description of the video. Let me know if you have any other questions.

[@poojamehta6818]

Is it compulsory to appoint an agent or a non residentbcan himself do all these things and no need to appoint agent

[@realestategame]

Yes it is compulsory to appoint an agent. If you don't pay then the Agent is responsible for the taxes. I think this is the way the government protects themselves by holding someone living in the country accountable for the taxes. If you don't have anyone to do this for you there are management companies that do charge you a fee to do this on your behalf.