Can you sell a house in Quebec as a non-resident?

Can you sell a Quebec house while you live outside Canada?

Yes. Living outside Canada does not stop the deed. A house in Quebec is the kind of property the federal rules call taxable Canadian property (Disposing of or acquiring certain Canadian property), and Revenu Québec calls an immovable in Quebec a taxable Quebec property. The person who sells notifies both, or the person who buys can be left holding part of the price for the tax. This page does not decide whether you are a non-resident. Revenu Québec says that if, during the year, you stayed in Quebec for one or more periods totalling 183 days or more, you are a deemed resident of Quebec for the whole year, and Quebec tax then applies to your worldwide income for that year (Tax obligations of non-residents of Québec). That sentence is not a complete test for having left Canada, and this page will not turn a day count into a residence opinion.

A house you did not use to earn income is the capital-property case Form T2062 and form TP-1097 are written for. A rental building can be depreciable property, and that file uses another form. An accountant decides which one the house is. The other costs of a Quebec sale, and the question of who signs if a parent is still the owner or the house comes from an estate, are on the pages linked below.

What do you send the Canada Revenue Agency, and by when?

For taxable Canadian property other than property described in subsection 116(5.2) and excluded property, you may notify a proposed disposition before it happens, and you must notify an actual disposition no later than 10 days after it, by registered mail. The actual notice is not required if, before the disposition, you already sent a proposed notice and the purchaser is the one named in it, the estimated proceeds are equal to or greater than the actual proceeds, and the adjusted cost base in that notice does not exceed the adjusted cost base immediately before the disposition. The notice names the other party, describes the property, and states the proceeds and the adjusted cost base. The form for capital property is Form T2062. If you pay 25% of the amount by which the proceeds exceed the adjusted cost base, or you give security the Minister accepts, the Minister issues a certificate: Form T2064 for a proposed disposition and Form T2068 for an actual one. A copy goes to you and to the purchaser. The circular says selling costs are not subtracted in that 25% calculation. They reduce the gain on the return for the year of the sale (Income Tax Act, section 116).

The circular says you should send a proposed notice at least 30 days before the disposition, so there is time to review it. That is not the 10-day legal deadline. A late actual notice can bring a penalty under subsection 162(7): the greater of $100 and $25 a day, to a maximum of $2,500. If you are not eligible for a social insurance number, the guide says to complete Form T1261, Application for a CRA Individual Tax Number, and send it as soon as possible. Do not complete T1261 if you already have a SIN, an ITN or a temporary tax number. For depreciable taxable Canadian property, the circular says to use Form T2062 for the gain or loss and Form T2062A for recapture of capital cost allowance or a terminal loss, even if no capital cost allowance was claimed, and that two certificates are then issued. Subsection 116(8) says the Minister may decline a certificate for residential property, as defined in the Underused Housing Tax Act, if the returns or the amounts payable under that Act are not in order, or in the case that subsection describes for the preceding calendar year. This page does not say who owes that tax (IC72-17R6, Procedures concerning the disposition of taxable Canadian property).

The same guide says to file a Canadian return for the year of the disposition. Amounts you or the buyer pay, other than penalties and interest, are interim. The return is the final settlement, and an overpayment is refunded with the notice of assessment. You are not required to file for that year if you are a non-resident, you have no tax payable for the year, you are not liable for any earlier year, and each property disposed of is excluded property or property for which no payment or security is required before the certificate is issued. Even then, you must file if you are claiming the principal residence exemption for any part of the gain, with Schedule 3 and Form T2091(IND) or Form T1255. The guide says that for most people the return is due April 30. For the year of the sale, that is generally April 30 of the year after the sale. An accountant confirms the date for the year of your sale (T4058, Non-Residents and Income Tax).

What does Revenu Québec ask for on form TP-1097?

A person who does not reside in Canada, including a trust or an estate, and who disposes of taxable Quebec property, for example an immovable in Quebec, must notify the Minister within ten days of the actual disposition. A proposed disposition can be notified as well, for example after the offer is signed. The form is TP-1097, Notice of Actual or Proposed Disposition of Taxable Quebec Property by an Individual or a Corporation Not Resident in Canada. A Quebec mining property or a Quebec timber property uses form TP-1102.1 instead. If the actual notice is late, the penalty is $25 a day, up to $2,500. Revenu Québec’s penalty page does not state a $100 minimum. The actual notice, and that penalty, are not required if a proposed notice was already sent and four conditions are all met: the proposed notice was for this property, the purchaser is the one named in it, the actual proceeds are equal to or lower than the proceeds in that notice, and the adjusted cost base immediately before the actual disposition is equal to or higher than the one in the notice. The penalty page says to send the actual notice by registered mail to Revenu Québec, 3800, rue de Marly, Québec (Québec) G1X 4A5 (Obligations fiscales des non-résidents du Québec, page in French).

If the disposition produces a taxable capital gain and the notice is accompanied by the calculated instalment or by acceptable security, Revenu Québec issues form TPF-1098, Certificate Respecting the Actual or Proposed Disposition of Taxable Quebec Property by a Person Not Resident in Canada, to the person who sells and to the purchaser. The certificate releases the purchaser from any liability for the tax arising from the transaction. The public page states that condition. It does not say a certificate is issued when there is no taxable capital gain (Omission de produire un avis d’aliénation réelle, page in French). The form itself is TP-1097, and the page for it says an electronic signature is accepted (TP-1097, page in French).

Article 1101 of the Taxation Act, in the text in force from 21 October 2015, says the purchaser of taxable Quebec property referred to in article 1097 pays the Minister, as tax on behalf of the person who does not reside in Canada, 12.875% of the amount by which the purchase price exceeds the amount stated in the certificate issued under article 1098, if any. The purchaser may deduct or withhold that amount from what is paid to the person who sells, and must remit it within 30 days after the end of the month of the acquisition. Article 1101 does not apply if a certificate was issued to the purchaser under article 1100, if article 1101.1 applies, or if after reasonable inquiry the purchaser had no reason to believe the other party did not reside in Canada (Taxation Act, article 1101, page in French). Article 1102.1, in force from 5 December 2024, is the other list: a life-insurance policy described there, a Quebec mining property, a Quebec timber property, an immovable in Quebec that is not capital property, and depreciable property that is taxable Quebec property. The certificate under that article is issued if the person pays an amount the Minister considers reasonable, or gives acceptable security. Article 1102.2, in the text in force from 4 June 2009, sets the purchaser’s amount at 30% of the amount by which the purchase price exceeds the amount stated in that certificate, with the same right to withhold and the same 30-day remittance. It does not apply if article 1101.1 applies, or after the same reasonable inquiry (Taxation Act, article 1102.1, page in French). The 30% rule is Taxation Act, article 1102.2, page in French.

What is withheld if there is no certificate, and what does the notary do with it?

The payment that gets the federal certificate, and the amount the purchaser can be made to remit if there is no certificate, are not the same percentage of the same number. To obtain the certificate under subsection 116(2) or 116(4), the circular says the payment or security is 25% of the proceeds minus the adjusted cost base. Outlays and expenses of the sale are not subtracted there. If no certificate under subsection 116(4) has been issued, and the property is not depreciable property or excluded property, subsection 116(5) makes the purchaser liable for 25% of the amount by which the cost of the property exceeds the limit on a subsection 116(2) certificate, if any. With no proposed certificate, that is 25% of the cost. The purchaser remits it to the Receiver General within 30 days after the end of the month of the acquisition, and may deduct or withhold it from the price. For property described in subsection 116(5.2), including depreciable taxable Canadian property and real property in Canada that is not capital property, subsection 116(5.3) sets the purchaser’s amount at 50% of the amount by which the price exceeds the amount fixed in the certificate, if any. The purchaser is not liable under subsection 116(5) if, after reasonable inquiry, there was no reason to believe the person who sells was not resident in Canada. The purchaser is also not liable under subsection 116(5) or subsection 116(5.3) where subsection 116(5.01) applies. That subsection applies if the purchaser concludes after reasonable inquiry that the person who sells is, under a tax treaty Canada has with a country, resident in that country, the property would be treaty-protected property of that person, and the purchaser sends the notice under subsection 116(5.02) on or before the 30th day after the date of the acquisition. The circular says the CRA looks at each case and will not make that inquiry for the purchaser. A copy of the certificate protects the purchaser from further liability on that particular notice. The final tax is still settled on the return.

The Quebec amounts are separate. Article 1101 is 12.875% of the purchase price above any article 1098 certificate amount. Article 1102.2 is 30% of the purchase price above the article 1102.1 certificate amount. Each is remitted within 30 days after the end of the month of the acquisition, and each may be withheld from the price. The OACIQ says that if the certificates are not in hand when the sale is signed, the notary who receives the deed keeps the retention in the trust account and does not release it to the person who sells before the certificates arrive. That page describes the trust account. It also states 12% for Quebec and 25% of the proceeds minus the cost. The rate in the current text of article 1101 is 12.875% of the purchase price above any certificate amount, and the federal amount the purchaser remits when there is no certificate under subsection 116(4) is 25% of the cost, not 25% of the gain. Use the statutes. The statutes say when the purchaser must remit. The OACIQ sentence says the person who sells does not receive that part of the price before the certificates are in the file (OACIQ, sale of an immovable by a non-resident, page in French). This page does not describe a comfort letter. The circular quoted here does not set one out. A purchaser who remits late can be assessed the penalty IC72-17R6 describes under subsection 227(9): 3% if the payment is one to three days late, 5% if four or five days late, 7% if six or seven days late, and 10% if more than seven days late (IC72-17R6, paragraph 56).

The legal warranty of quality is a different question from the holdback. The OACIQ says it still applies to a sale of an immovable in Quebec unless the parties agree otherwise, and that living outside Canada does not, by itself, remove it. It also says a buyer can have practical difficulty pursuing someone who is not in Quebec. An offer with no inspection condition does not, by itself, set aside the legal warranty of quality. How that clause is written is the subject of Selling a house as-is in Quebec.

Does the principal residence exemption cover years you lived outside Canada?

Not those years. The folio says that even where a house in Canada could meet the definition of a principal residence for a year in which the owner was a non-resident, the exemption is limited by the number of tax years ending after the acquisition date during which the owner was resident in Canada. For a disposition after 2 October 2016, the extra year in the formula is available only if the owner was resident in Canada during the year that includes the acquisition date. The folio says that for a disposition before 3 October 2016 that extra year was available even without residence in the year of acquisition, and that “during” a year means at any time in the year. Guide T4058 says a period of non-residence may reduce the exemption or eliminate it. The formula, the forms, and the one-home limit are in Do you pay capital gains tax when you sell your house in Quebec?.

The circular still requires a T2062 or a similar notice when a non-resident disposes of a principal residence. It says the tax or security may be reduced where the exemption reduces the gain, and that lines 1 to 3 of Form T2091 are not to include any tax year during which the person was not resident in Canada. The designation can be made on Form T2091(IND) or in a signed letter with the notice. Reporting the sale, even where the gain is exempt, is the subject of the capital-gains page (Income Tax Folio S1-F3-C2, Principal Residence). The CRA’s principal-residence page says to call 1-800-959-8281 if you were not a resident of Canada for the entire time you owned the designated property (Principal residence).

Who pays the welcome tax on this sale?

The buyer pays Montreal’s property transfer duties, called the welcome tax. They are not the section 116 amount and they are not the article 1101 amount. This page does not repeat the brackets. The City’s page, and the fact that the brackets change every year, are in Who pays the Montreal welcome tax?.

Commission, if you list, a mortgage penalty, the certificate of location, the notary’s fee to discharge a hypothec, and the tax adjustment to the closing date are a different list. They are in The real costs of selling a house in Quebec. None of those pages, and not this one, states what a particular house will clear after the holdback.

How do you sign the deed if you are not in Quebec?

You do not have to be in the room. The Chambre des notaires says a procuration, or mandate, lets a person of sound mind authorize someone else to act, and that a protection mandate is the different document, for a person who has lost capacity. It says it is preferable to limit the powers. A mandate can cover only the sale of the property on the conditions you set, and the person you name then does only what that sale requires. The law does not require that person to sign the procuration. Signing it is how they acknowledge they have read it. You can revoke a procuration at any time, and the Chambre says a notarial revocation is preferable. A notary can prepare the procuration. This page does not say a signature made by video from abroad is accepted, and it does not say a private signature from outside Canada is refused. The notary on the file says which form it will take (La procuration, page in French).

The papers a Quebec closing asks for besides the tax notices are in What documents do I need to sell a house in Quebec?. The T2062 instructions have their own list of supporting papers. This page does not replace that list. If a parent is still the owner, who may sign is in How do you sell a parent's house in Quebec?. If the owner has died, the declaration of transmission and who signs for the estate are in How do you sell an inherited house in Quebec?. A person who does not reside in Canada can still have the section 116 notice to file. Those pages do not replace it.

What do you do about insurance while the house is empty?

If the house will be empty, ask your insurer what it requires while you are away, and follow its conditions. This page does not describe what a policy covers.

What is the timeline from the offer to the notary’s payout?

There is no number of weeks on the CRA pages cited here, and this page will not invent one. The circular says the certificate is issued at the earliest date once the information, the supporting papers and the payment or security have been received and checked, and that a proposed notice should go at least 30 days before the disposition. The order that follows is the one the statutes and the OACIQ describe. It is not a promise that a particular file will move on a named day.

Before the offer, an accountant is the person who confirms residence, and Form T1261 is the application if you have no SIN, ITN or temporary tax number. When the offer is signed, the proposed notices can go to the CRA and to Revenu Québec. If you will not attend, the procuration has to be one the notary will accept, limited to this sale and to the conditions you set. At the deed, the notary receives the act. If Form T2068, or Form T2064 within its limit, and form TPF-1098 are not in the file, the purchaser is entitled to the statutory withholding, and the OACIQ says the notary keeps that retention in trust. Within 30 days after the end of the month of the acquisition, the purchaser remits what is still owing. Within 10 days after the disposition, the actual notice goes by registered mail if the proposed notice does not already cover the sale. For the year of the sale, the return is the final settlement. What the house is worth is a separate question, answered in How much is my house worth in the West Island?.

Bruce Malcolm buys houses himself on the Island of Montreal and the surrounding areas. He holds no broker, agent or appraiser licence. He is not a notary or an accountant, and he does not give tax advice. There is no inspection and no commission. An offer with no inspection condition does not, by itself, set aside the legal warranty of quality. The closing date is one you choose once the notary can sign. Sending the address starts a conversation (request an offer). The form does not commit you.