Electing under section 217

This page provides information for individuals who are interested in choosing to elect under section 217 of the Income Tax Act.

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What is a section 217 election?

If you are a non-resident of Canada, Canadian payers have to withhold non resident tax on certain types of Canadian-source income they pay or credit to you. The tax withheld is usually your final tax obligation to Canada on this income and you do not have to file a Canadian Income Tax and Benefit Return to report it. However, you can choose to file a Canadian return to report certain types of Canadian source income listed in the next section by “electing under section 217 of the Income Tax Act.” In doing so, you may pay tax on this income using a different method and may receive a refund of all or part of the non resident tax withheld.

If you emigrated from Canada in 2021, the section 217 election applies to Canadian-source income (listed below) that is received after leaving Canada.

If you immigrated to Canada in 2021, contact the Canada Revenue Agency (CRA) for any special section 217 rules that may apply to you. The CRA’s address and telephone numbers, can be found under Contact the Canada Revenue Agency.

Eligible section 217 income

The section 217 election applies to the following types of Canadian-source income:

  • old age security pension

Note

If you received old age security benefits, you may have to file Form T1136, Old Age Security Return of Income, even if you choose not to file a return under section 217. For more information, see Guide T4155, Old Age Security Return of Income Guide for Non-Residents.

  • Canada Pension Plan (CPP) and Quebec Pension Plan (QPP) benefits
  • most superannuation and pension benefits
  • most registered retirement savings plan payments
  • most pooled registered pension plan payments
  • most registered retirement income fund payments
  • death benefits
  • employment insurance benefits
  • certain retiring allowances
  • registered supplementary unemployment benefit plan payments
  • most deferred profit-sharing plan payments
  • amounts received from a retirement compensation arrangement, or the purchase price of an interest in a retirement compensation arrangement
  • prescribed benefits under a government assistance program
  • Auto Pact benefits

Why elect under section 217?

You will benefit from electing to file a return under section 217 if the total tax payable on line 43500 of your return is less than the tax you would otherwise pay if you did not make this election. When processing your return, the CRA will only take your election under section 217 into account if it is beneficial.

To determine the tax you would otherwise pay, and for more information on whether electing under section 217 is beneficial for you, go to Why elect under section 217?

Which tax guide should you use?

To file a return under section 217, use the Income tax and Benefit Guide for Non-residents and Deemed Residents of Canada.

Section 217 return due date

Your 2021 section 217 return must be filed on or before June 30, 2022. However, if you have a balance owing for 2021, you need to pay it on or before April 30, 2022, to avoid interest charges.

If you file your 2021 return after June 30, 2022, the CRA cannot accept your section 217 election according to the Income Tax Act. If you file late and the required amount of non-resident tax was withheld on your eligible section 217 income, the CRA will consider the amount withheld to be your final tax obligation to Canada on that income. However, if the payer withheld less than the required amount of tax, the CRA will send you a notice of assessment for the difference.

Note

The due date for filing your section 217 return may be different if you also report other types of Canadian source income on this return. These types could include employment or business income, net Canadian partnership income if you are a limited or non active partner, or taxable capital gains from disposing of taxable Canadian property. For more information, see Due dates.

Reducing tax withheld (Form NR5)

If you want to make a section 217 election on eligible income that you have not yet received, you can apply for a reduction to the non-resident tax the payer would otherwise need to withhold.

To do this, complete Form NR5, Application by a Non‑Resident of Canada for a Reduction in the Amount of Non‑Resident Tax Required to be Withheld, and send it to the CRA for approval on or before October 1, or before the first payment is due. If the CRA approves your application, you must file a section 217 return for each year in the approval period.

Note

If approved, Form NR5 is valid for a period covering five tax years. However, if your situation changes during this period, you may need to file a new Form NR5. For more information, see Form NR5 – 5-year Administrative Policy.

The CRA will use the information you give on Form NR5 to determine if a section 217 election will benefit you. If the election is beneficial for you, the CRA will authorize your Canadian payer(s) to reduce the amount of non‑resident tax withheld from your benefits during the approval period.

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