Non-Resident Speculation Tax (All You Need to Know)

Posted on 21 May 2024 Back to News



By: Joshua Clarke & Michael Hanton

Contact Joshua Clarke

Contact Michael Hanton


This guide explains Ontario’s Non-Resident Speculation Tax (NRST), a tax on certain purchases of residential property by foreign individuals and entities.



The Ontario government introduced the NRST as part of its Fair Housing Plan. The tax aims to curb speculative activities by foreign buyers that can artificially drive-up housing prices, making affordability a challenge for Ontario residents. While intended to benefit residents (i.e. by making it easier to enter or move up in the real estate market), the NRST adds significant costs for foreign buyers, potentially impacting their ability to invest in Ontario real estate.

Non-compliance or misunderstanding of the tax’s requirements can lead to financial penalties and legal complications. For those considering property transactions in Ontario, a thorough understanding of the NRST is essential.


The NSRT is a tax on the purchase or acquisition of an interest in residential property within Ontario by:

  1. Foreign Nationals: As defined in the Immigration and Refugee Protection Act, foreign nationals are individuals who are not citizens or permanent residents of Canada.
  2. Foreign Entities: Any corporation incorporated outside of Canada is considered a foreign corporation. Additionally, even if incorporated in Canada, a corporation is considered a foreign corporation if it is controlled by:
    • Foreign national(s);
    • foreign corporation(s); or
    • other Canadian corporations which are themselves ultimately controlled by foreign entities.

For the purpose of the NRST, “control of a corporation” includes both direct and indirect control.

  1. Taxable Trustees: A taxable trustee means a trustee of a trust where:
    • at least one of the trustees is a foreign entity; or
    • the trust has at least one beneficiary who is a foreign entity. This applies even if none of the trustees are foreign.


The NRST applies to the transfer of “designated land”, which is land that contains 1-6 single family residences. If the property has mixed uses, the NRST applies only to the value of the consideration allocated to the residential portion of the property.

The NRST does not apply to other types of land such as:

  • land containing multi-residential rental apartment buildings with more than six units;
  • agricultural land; or
  • commercial or industrial land


The NRST is applied to the full value of consideration for a conveyance. The “value of consideration”, as defined in the Land Transfer Tax Act, is broad and not limited to the purchase price listed in the agreement of purchase and sale. It is the total monetary value involved in a conveyance, including:

  • The gross sale price or any monetary consideration exchanged or promised;
  • the monetary value of any liabilities assumed by the purchaser; and
  • any monetary value of benefits transferred by the buyer as part of the conveyance arrangement.

Importantly, the NRST applies to the full value of consideration even if a foreign national, foreign entity, or taxable trustee acquires a less-than-100% interest in the property.


  1. April 21, 2017 – March 29, 2022: The NRST became effective on April 21, 2017, and does not apply retroactively to agreements of purchase and sale made before that date. It was initially set at 15% and applied solely to residential properties located within the Greater Golden Horseshoe (GGH) region. The region was chosen due to its particularly high real estate demand and corresponding affordability issues.
  2. March 30, 2022 – October 24, 2022: On March 30, 2022, the geographical scope of the NRST was expanded to cover all of Ontario and the rate was increased to 20%.
  3. October 25, 2022 – Present: The rate was increased to 25%.


Transitional provisions may apply which allow the application of the rules that were in effect on the date of the agreement (i.e. and agreement of purchase and sale), rather than the date the real estate transaction closes. However, for those provisions to apply, the land cannot be conveyed to a foreign entity or taxable trustee other than the purchaser or assignee (and their spouses). Otherwise, the 25% rate will apply.


Certain situations are exempt from the NRST, including:

  • Purchases by nominees on behalf of Canadian citizens or permanent residents;
  • acquisitions through inheritance; or
  • refugees and other protected persons.


NRST rebates may be available if certain conditions are met. These include situations where the purchaser of the property:

  • Becomes a citizen or permanent resident of Canada within four years of the purchase;
  • works full-time in Ontario for at least one year after the purchase; or
  • is an international student enrolled full-time for at least two years in an approved Ontario school and physically present in Ontario for 240 days per year.


The NRST is distinct from the federal government’s Prohibition on the Purchase of Residential Property by Non-Canadians Act, which was extended another two years, to January 1, 2027. The federal ban has its own set of criteria and operates separately. It is possible for an individual or entity to be exempt from the federal ban but still be subject to the NRST.

For more information on that legislation, please see our article here.



It is crucial to understand if and how the NRST affect your purchase. If you think it applies to you, or if you have questions, please contact one of our real estate lawyers.



This article is current as of March 26th, 2024, and it is intended for general information purposes only. It is not intended to provide legal advice and should not be considered legal advice. Readers with concerns about how this affects particular situations or transactions should obtain the independent review and advice of legal counsel.

Go Back

"Expedient, personal, and pleasant to deal with"

"Good service, easy to work with"

"Extremely happy with the service provided"

"Your service was excellent and very efficient"

"Top notch service. No improvement necessary"

"Good service, friendly approach"

"They’re efficient and do a great job"


See what we have been up to

Non-Resident Speculation Tax (All You Need to Know)

    By: Joshua Clarke & Michael Hanton   This guide explains Ontario’s Non-Resident Speculation Tax (NRST), a tax on certain purchases of residential property by foreign individuals and entities. ......

Read Now

Notice to Clients: 2024 Capital Gains Changes

  The 2024 federal budget has brought unexpected news for taxpayers and tax professionals alike. The budget proposed changes to the capital gains inclusion rate, aimed at enhancing tax fairness ......

Read Now

Canada’s Foreign Buyer Ban (A Complete Guide)

  By: Joshua Clarke & Jennifer Parker   Introduction To address the growing concern of housing affordability in Canada, the federal government has extended the Prohibition on the Purchase of ......

Read Now

HGR Graham Partners Sponsors 2024 SheLeads Georgian Bay

  HGR Graham Partners LLP is pleased to be co-sponsoring SheLeads Georgian Bay with Ferguson Deacon Taws LLP as the Venue Sponsor. Join us on Saturday, May 25, 2024 for ......

Read Now

Cohabitation Agreements & Marriage Contracts

  Cohabitation and marriage contracts are agreements between partners that set out the parties’ rights and obligations in the event of their separation. They are forward looking agreements and may ......

Read Now

Temporary Help Agencies and Recruiters – ESA Changes (What You Need to Know)

    Recent changes to the Employment Standards Act (ESA) have altered the landscape for Temporary Help Agencies and Recruiters who carry on business in Ontario. Many companies across the ......

Read Now

What is Title Insurance? (What you need to know)

  A title insurance policy is a policy of indemnity that insures against loss or damage arising from title defects or other covered risks which may include survey issues, encroachments, ......

Read Now

Scroll to top