The Prohibition on the Purchase of Residential Property by Non-Canadians Act (also known as the Foreign Ban) came into effect on Jan 1, 2023. With the final release of policy details and regulations unfolding just days before the new year, many Temporary Residents found themselves scrambling over the holidays wondering how the new legislation affects them. Since then there have been some notable revisions. The most striking changes were exemptions pertaining to work and study permit holders:
Temporary residents working in Canada are exempt, if they:
hold a valid work permit or are authorized to work in Canada, and
have 183 days or more of validity remaining on their work permit or work authorization at time of purchase, and
have not previously purchased a residential property in Canada while the prohibition was in effect
Temporary residents studying in Canada are exempt, if they:
have filed income tax returns for each of the 5 taxation years preceding the year in which the purchase was made, and
have been physically present in Canada for a minimum of 244 days in each of the 5 calendar years preceding the year in which the purchase was made, and
have not previously purchased a residential property in Canada while prohibition is in effect, and
purchase a property for a price not exceeding $500,000
Here are some other key points and notable exemptions of the Act:
the Act came into force on January 1, 2023 and will remain in effect for a period of 2 years,
the Act doesn’t apply to non-Canadians who entered into binding offers of purchase and sale before January 1, 2023 even if the sale is finalized during the prohibition period,
the Act also applies to corporations and entities formed under the laws of Canada or a province, not listed on a stock exchange in Canada and controlled by someone who is a non-Canadian,
the Act doesn’t apply to non-Canadian spouses and common-law partners, if they purchase residential property in Canada with their spouse or common-law partner who is a: Canadian citizen, person registered under the Indian Act, permanent resident, or non-Canadian for whom prohibition does not apply
Situations where the Act doesn’t apply:
when a non-Canadian acquires an interest in a residential property becuase of a divorce, separation, gift, or death
when a non-Canadian rents a dwelling unit for the purpose of occupying the dwelling unit – in other words, a non-Canadian who is renting and occupying the dwelling unit does not constitute a purchase,
when a non-Canadian purchases residential property for the purposes of development,
when a creditor exercises a security interest or secured right, such as the seizure and foreclosure of a residential property
If you are a Permanent Resident you are NOT affected by Foreign Buyer Tax and the Foreign Ban.
Click Here for expanded details of the Act as interpreted by the Canada Housing and Mortgage Corporation (CMHC).
If you are a Temporary Resident and wondering if you are eligible for any of the above exemptions, call or text Marko Gelo directly at 604-800-9593 cell/text, or schedule a phone call in the future with Marko at your convenience.
Exemptions and Revisions: How the Foreign Buyer Ban Affects Temporary Residents
(Sept 12, 2023)
The Prohibition on the Purchase of Residential Property by Non-Canadians Act (also known as the Foreign Ban) came into effect on Jan 1, 2023. With the final release of policy details and regulations unfolding just days before the new year, many Temporary Residents found themselves scrambling over the holidays wondering how the new legislation affects them. Since then there have been some notable revisions. The most striking changes were exemptions pertaining to work and study permit holders:
Temporary residents working in Canada are exempt, if they:
hold a valid work permit or are authorized to work in Canada, and
have 183 days or more of validity remaining on their work permit or work authorization at time of purchase, and
have not previously purchased a residential property in Canada while the prohibition was in effect
Temporary residents studying in Canada are exempt, if they:
have filed income tax returns for each of the 5 taxation years preceding the year in which the purchase was made, and
have been physically present in Canada for a minimum of 244 days in each of the 5 calendar years preceding the year in which the purchase was made, and
have not previously purchased a residential property in Canada while prohibition is in effect, and
purchase a property for a price not exceeding $500,000
Here are some other key points and notable exemptions of the Act:
the Act came into force on January 1, 2023 and will remain in effect for a period of 2 years,
the Act doesn’t apply to non-Canadians who entered into binding offers of purchase and sale before January 1, 2023 even if the sale is finalized during the prohibition period,
the Act also applies to corporations and entities formed under the laws of Canada or a province, not listed on a stock exchange in Canada and controlled by someone who is a non-Canadian,
the Act doesn’t apply to non-Canadian spouses and common-law partners, if they purchase residential property in Canada with their spouse or common-law partner who is a: Canadian citizen, person registered under the Indian Act, permanent resident, or non-Canadian for whom prohibition does not apply
Situations where the Act doesn’t apply:
when a non-Canadian acquires an interest in a residential property becuase of a divorce, separation, gift, or death
when a non-Canadian rents a dwelling unit for the purpose of occupying the dwelling unit – in other words, a non-Canadian who is renting and occupying the dwelling unit does not constitute a purchase,
when a non-Canadian purchases residential property for the purposes of development,
when a creditor exercises a security interest or secured right, such as the seizure and foreclosure of a residential property
If you are a Permanent Resident you are NOT affected by Foreign Buyer Tax and the Foreign Ban.
Click Here for expanded details of the Act as interpreted by the Canada Housing and Mortgage Corporation (CMHC).
If you are a Temporary Resident and wondering if you are eligible for any of the above exemptions, call or text Marko Gelo directly at 604-800-9593 cell/text, or schedule a phone call in the future with Marko at your convenience.
Home Financing Solutions is a franchise of The Mortgage Centre. Offices in Calgary and Vancouver. One Application, One Credit Check and access to Canada's top lenders.
