— March 12, 2024 —

With April 30th quickly approaching, concern around the Underused Housing Tax (UHT) returns for 2023 has been palpable among Canadian CPAs and their clients. The Fall economic statement brought some hope, suggesting a shift in filing requirements for specified Canadian trusts, partnerships, or corporations, provided there’s no tax payable. Yet, the absence of formal legislation had left many of us in a state of limbo, questioning the likelihood that this promise would be realized.

In a recent turn of events, the Canada Revenue Agency (CRA) has released updated Form UHT-2900, the official document for UHT returns. As of February 29, 2024, the form’s instructions reveals a newly defined term: “Excluded Owner” for the year 2023. This inclusion seems to be the CRA’s way of integrating the Fall statement’s announcements directly into the filing process, offering clarity amidst the uncertainty.

What does this mean for us and our clients? Simply put, if the updated form instructions indicate that no filing is required for those who fall under the “Excluded Owner” category, it’s suggesting that the CRA is leaning towards leniency, at least for this filing season. Should there be a backtrack requiring a filing after all, it’s reasonable to anticipate that the CRA would abstain from imposing penalties, considering their guidance.

While this update is indeed a positive development, it’s crucial to remember that all 2023 returns are still due by April 30, 2024. This deadline remains a critical date for those aiming to stay within the CRA’s penalty relief parameters.

As we await a more formal announcement from the CRA, this recent update to the UHT return form instructions should provide some relief and guidance for Canadian CPAs and their clients navigating the complexities of the UHT for 2023. It’s a reminder of the importance of staying abreast of the latest tax developments and ensuring compliance within the evolving landscape of Canadian tax law.

To stay abreast of developments such as these be sure to subscribe to our email newsletter at the top or bottom of this page.