Subsection 216(1) Late-filing Policy

What is the subsection 216(1) late-filing policy?

This policy allows you to file a subsection 216(1) income tax return late if you are a non-resident to whom subsection 216(1) of the Income Tax Act applies.

We will not accept under this policy the late filed 216 income tax return if:


An extension to file a subsection 216 (4) income tax return could be approved when extraordinary circumstances exists. (Subsection220(3)).

What is the purpose of the policy?

This policy will give non-residents eligible under subsection 216(1) one chance to come forward and correct withholding and filing deficiencies under Part XIII.

Although we will not apply penalties, we may charge arrears interest for any failure to deduct and remit tax under Part XIII and for any outstanding Part I tax liability.

What are the normal withholding and filing requirements?

Non-residents are required to pay income tax of 25% on amounts they receive as rental income on real property in Canada or as timber royalties earned in Canada.

The 25% tax is usually considered the final tax liability. However, a non-resident can elect to pay tax on the net income instead of the gross income by filing an income tax return under section 216. In most cases, the tax payable on an income tax return filed under section 216 is less than the tax withheld on the gross rental income.

You have to file the section 216 return:

Need more information?

For more information about the Subsection 216(1) Late-filing Policy, contact the International and Ottawa Tax Services Office.

Forms and publications

Page details

Date modified: