It feels like the summer co-op running the till at your local gas station is also making policies at the CRA. In April, I covered the back-and-forth on bare trust tax filing for regular folks. Now, in May, there’s been a massive mix-up over whether tenants of rental properties owned by foreigners need to withhold 25% of the rent for taxes.
In a recent court case covered by the Globe and Mail, a tenant was held liable for this tax when the government failed to collect it from the landlord. He had to pay 6 years of back taxes and interests. Imagine telling your landlord you’re holding back 25% of their rent! Naturally, a social media storm erupted.
To her credit, the minister responsible tweeted within days of the storm that this was a special case and tenants usually aren’t responsible for a foreign landlord’s tax liabilities. No details were given on why this case was special, and the law is still on the books. So, it looks like it’ll be a while before this mess is sorted out.
