The headline is simple: the Underused Housing Tax (UHT) is eliminated for the 2025 and later calendar years — there is no UHT payable and no UHT return required for 2025 onward. The elimination was announced in Budget 2025 and enacted through Bill C-15, which received Royal Assent on March 26, 2026. That said, the UHT was a real obligation for the 2022, 2023 and 2024 calendar years, and penalties and interest for those years can still apply. This guide explains what the UHT was, who it affected, and exactly what changed.
What the UHT was
The Underused Housing Tax was a 1% annual tax on the value of vacant or underused Canadian residential property owned by "affected owners." It was a federal tax introduced to apply to certain residential properties that were not being put to sufficient use. The obligation had two parts: an affected owner generally had to file a UHT return for each property, and pay the 1% tax unless an exemption applied.
Source: canada.ca — Underused Housing Tax
The years the UHT applied: 2022, 2023 and 2024
Returns were required for the 2022, 2023 and 2024 calendar years. If you were an affected owner of Canadian residential property in any of those years, the filing and (where no exemption applied) the 1% tax obligations were in force.
This matters even now, because the elimination is forward-looking. The fact that the UHT no longer applies from 2025 does not erase the obligations that arose for 2022 through 2024. Penalties and interest for those years still apply, so an owner who missed a required 2022, 2023 or 2024 filing should address it rather than assume the elimination wiped the slate clean.
Source: canada.ca — Underused Housing Tax
What changed: eliminated for 2025 and later
The current status is the important part. The UHT is eliminated for the 2025 and later calendar years:
- No UHT is payable for 2025 onward, and
- No UHT return is required for 2025 onward.
This elimination was announced in Budget 2025 and enacted via Bill C-15, which received Royal Assent on March 26, 2026. In practical terms, owners who previously filed UHT returns do not need to file a UHT return for 2025 or later years. The obligation that existed for 2022 through 2024 simply does not continue forward.
Source: canada.ca — Underused Housing Tax · Department of Finance — Budget 2025
What this means for owners now
Two things follow from the change:
- For 2025 and later — there is nothing to file and nothing to pay under the UHT. The tax is gone on a go-forward basis.
- For 2022 through 2024 — the obligations were real, and any outstanding filings or amounts from those years remain subject to the penalties and interest that applied. If you owned Canadian residential property as an affected owner in those years and did not deal with the UHT at the time, that history is still worth reviewing.
The cleanest way to close the file is to confirm that any 2022-2024 obligations were met and then treat 2025 onward as a non-event for UHT purposes.
How RN Canada helps
RN Canada helps Alberta and BC property owners and corporations close out the Underused Housing Tax correctly: confirming whether 2022, 2023 or 2024 returns were required and filed, addressing any outstanding obligations for those years before penalties and interest grow, and confirming that no UHT return or tax applies for 2025 onward so the file can be closed cleanly. Our bookkeeping and tax filing service covers the historical filings and the go-forward position. To review your UHT history, contact us.
This is general information, not personalized tax advice. Speak to us about your specific situation through our contact page.
Frequently asked questions
No. The Underused Housing Tax is eliminated for the 2025 and later calendar years — there is no UHT payable and no UHT return required for 2025 onward. The elimination was announced in Budget 2025 and enacted through Bill C-15, which received Royal Assent on March 26, 2026. The tax still applied for the 2022, 2023 and 2024 calendar years.
Affected owners were required to file a UHT return for the 2022, 2023 and 2024 calendar years. The UHT was a 1% annual tax on vacant or underused Canadian residential property owned by affected owners. Penalties and interest for failing to meet the obligations for those years can still apply, so a missed filing for 2022 through 2024 should not be ignored.
The UHT was a 1% annual tax on the value of vacant or underused Canadian residential property owned by affected owners. It applied for the 2022, 2023 and 2024 calendar years and is eliminated from 2025 onward, so the 1% tax no longer applies for 2025 and later years.