What if you're selling a property with multiple co-owners (sellers)?

If you're selling a property with multiple co-owners (sellers), there are specific rules to follow, especially if some are non-residents of Canada for tax purposes. Here's what you need to do, step by step:

1. Each co-owner is treated individually

• Each seller, whether resident or non-resident, is responsible for their own share of the sale.

• Each seller's share must be clearly stated (e.g., 50/50, 30/70, etc.).

• Tax obligations vary depending on each individual's tax status.

2. Obligations for Non-Residents

Each non-resident must:

• File a separate T2062 form for their share of the disposition. Provide other forms depending on the situation (T2062A, T2091, Quebec-specific obligations, etc.).

• Provide supporting documents specific to their situation (proof of purchase, calculation of adjusted cost base for tax purposes, capitalizable expenses, etc.).

• File a Canadian income tax return (T1-NR) after the sale (with some exceptions).

3. Obligations for Canadian Residents

• Canadian residents do not require a certificate of compliance.

• They must report their share of the gain on their regular T1 return.

• No tax is withheld at source from their share.

4. Buyer's Obligations

• The buyer (via their notary/lawyer) is required to withhold 25% (37.875% if in Quebec) or 50% if the property has been rented (62.875% if in Quebec) of the gross sale price allocated to non-residents, unless a T2064 certificate has been obtained in time.

• The buyer must therefore know who is a resident and who is not, and in what proportions.

5. Simple example

You are selling a property with two other people:

• You are a non-resident (33.33%)

• Co-owner 1 is a resident (33.33%)

• Co-owner 2 is a non-resident (33.33%)

Sale for 900,000$, was bought for 600 000$, gain of $300,000

• You and the other non-resident co-owner must each file a T2062 and pay the estimated tax on $100,000 of profit each.

• The buyer must withhold 25% of $600,000 (the non-residents' share of the sale price) = $150,000, unless the certificates (if requested upon possible disposition) are received on time.

• The resident co-owner reports their gain normally on their Canadian return.

6. Practical Tips

• Coordinate among co-owners from the start to avoid bottlenecks during the sale.

• If there are several non-residents, each must:

  • Obtain a Canadian tax number (SIN, TIN, or BN)

  • Prepare their own T2062 forms and any other related forms, as appropriate.

  • Submit their own documents (joint copies are accepted, but separate files are required).

In Summary

Case	Action Required
Multiple Sellers	Each seller is responsible for their own share
Non-Resident	Must file a T2062, pay a deposit, then file a T1-NR
Canadian Resident	Reports their gain on their regular T1 return
Buyer	Withholds tax on the non-resident share (except certificate)
Form T2062	One form per non-resident co-owner