Foreign buyers in Canada: the federal ban and the taxes that stack (2026)

The layer cake, top to bottom

Level	Measure	Rate	In force
Federal	Ban on purchases by non-Canadians (homes of 1 to 3 units)	Prohibition — fine up to $10,000	2023 → January 1, 2027
Ontario	Non-Resident Speculation Tax (NRST) — province-wide	25% of the price	Since October 2022
Toronto	Municipal NRST — ADDS to the provincial tax	+10% (35% combined)	Since January 1, 2025
British Columbia	Additional Property Transfer Tax — designated areas	20% of the price	Since 2018 (current rate)
Federal (annual)	Underused Housing Tax (UHT)	1% of value, every year	Since 2022
Toronto / Vancouver (annual)	Vacant home tax	3% of value, every year	Toronto: 3% from tax year 2024; Vancouver: 3%
BC (annual)	Speculation and Vacancy Tax	3% foreign · 1% residents (doubled)	From tax year 2026 (0.5%/2% before)

Rates verified at source on 2026-08-12. The federal ban covers buildings of 3 units or fewer located in major population centres (CMAs/CAs); it was extended from 2025 to 2027 in February 2024 — barring a new extension, it expires January 1, 2027. The NRST and MNRST apply to foreign individuals AND corporations they control; rebates exist (notably on becoming a permanent resident within the prescribed time). ⚠️ This landscape moves several times a year: confirm every rate at its official source before signing.

The ban first — and its surprising exceptions

Since January 1, 2023, a non-Canadian (neither citizen nor permanent resident) cannot buy "residential property" — defined as 3 dwelling units or fewer, condos included. Anyone who knowingly assists (agent, lawyer, nominee) faces the same fine, and a court can order the property's forced sale. Already extended once (from 2025 to 2027), the ban expires January 1, 2027 — a horizon to watch, not an eternity.

The exceptions carry all the litigation: buildings of 4 or more units are out of scope; so are properties outside major population centres (outside CMAs and CAs — the regional cottage, typically); and since March 2023, eligible work-permit holders can buy a home to live in. Foreign students and refugees have their own narrow regimes. Qualification is case-by-case — a file for a lawyer or notary BEFORE the offer, not after.

Where buying is allowed, count the tax storeys

An eligible foreign buyer purchasing in Toronto today pays 35% in speculation taxes at purchase: 25% provincial NRST (all of Ontario since October 2022) plus 10% municipal MNRST since January 1, 2025 — $175,000 on a $500,000 purchase, before even the ordinary land transfer tax, itself doubled in Toronto. In British Columbia, the additional tax is 20% in designated areas (Metro Vancouver, Fraser Valley, Victoria, Kelowna, Nanaimo). Quebec, the Prairies and the Maritimes have no equivalent provincial tax — a 20-to-35-point differential few comparisons state plainly.

Then come the annual taxes, hitting ownership itself: the federal 1% UHT on non-residents' underused housing (with a mandatory filing even when an exemption applies — failing to file is penalized on its own), the 3% municipal vacancy taxes in both Toronto and Vancouver, and BC's Speculation and Vacancy Tax, whose rates double from tax year 2026: 3% for foreign owners and "satellite families", 1% for Canadian residents. A vacant Vancouver pied-à-terre can thus stack UHT + EHT + SVT — three filings, three bills, every year.

Frequently asked questions

Can a foreigner buy a house in Canada in 2026?

A non-resident, in principle, CANNOT buy a home in Canada: the federal ban (Prohibition on the Purchase of Residential Property by Non-Canadians Act), in force since 2023, has been extended to January 1, 2027 — with fines up to $10,000 and a possible forced sale. It carries real exceptions: eligible work-permit holders, buildings of 4 or more units, properties outside major population centres. Where buying is allowed, the taxes stack: 25% NRST in Ontario PLUS Toronto's 10% municipal tax since January 2025 (35% combined — $175,000 on a $500,000 purchase), 20% in British Columbia's designated areas. Then come the annual vacancy taxes: the 1% federal UHT, 3% in Toronto and Vancouver, and BC's speculation tax doubled to 3% for foreign owners from 2026. Quebec and the Prairies have no equivalent provincial tax.

What are the exceptions to the federal ban?

The main ones: eligible work-permit holders buying a home to live in (March 2023 easing); buildings of 4 or more units (the ban only covers 3 or fewer); properties outside major statistical population centres (outside CMAs/CAs); certain students, diplomats and refugees under narrow conditions. The penalty also reaches anyone who knowingly assists: up to a $10,000 fine and a court-ordered forced sale.

How much tax does a foreign buyer pay in Toronto?

35% of the price in speculation taxes: 25% Ontario NRST plus 10% Toronto MNRST (in force since January 1, 2025) — $175,000 on $500,000. Add the ordinary land transfer tax, doubled in Toronto (provincial + municipal), then every year the 3% vacancy tax if the home sits unoccupied. NRST rebates exist, notably for buyers who become permanent residents within the prescribed time.

Does BC's 20% tax apply everywhere in the province?

No — only in the designated areas: Metro Vancouver, the Fraser Valley, the Capital Region (Victoria), the Central Okanagan (Kelowna) and Nanaimo. Outside those zones the 20% additional property transfer tax does not apply — but the federal ban applies in every major population centre in the country, and the Speculation and Vacancy Tax covers its own zones, expanded in 2024.

Does Quebec tax foreign buyers?

No — no special provincial tax on foreign buyers exists in Quebec, the Prairies or the Maritimes. The federal ban still applies there (Montreal and Quebec City are CMAs), and ordinary transfer duties remain due. That is a 20-to-35-percentage-point gap with Toronto and Vancouver — one of the Canadian market's least-documented contrasts.

Sources

A cross-border file to structure?

Eligibility and exemptions are settled before the offer, not after. Payotte names a single verified lawyer or notary per sector — selected on public data, never on payment.

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Buying in Canada as a non-resident: the ban, then the taxes that stack