BorderBird
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🇺🇸 US residents · 🇨🇦 Canadian rental property

Built for Americans who own Canadian rental property.

If you live in the US and rent out a property in Toronto, Vancouver, Montreal or anywhere else in Canada, you face Part XIII withholding, Section 216 elections, and US Schedule E reporting. BorderBird makes the workflow tractable — set up in 5 minutes, AI does the rest.

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Why landlords pick BorderBird
5-minute setup

Create account, connect Gmail, add a property, add a tenant, run the first scan. Five steps, about a minute each.

AI Gmail import

Rent payments, utility bills, and receipts detected automatically — matched to the right property, dated, and queued for one-click import.

Forwarded email history

Years of payments in Yahoo, Outlook, or Apple Mail? Forward them to Gmail and BorderBird imports them with their original dates.

AI lease extraction & history

Upload a signed lease PDF — AI pulls dates, rent, and tenant names. Renewals, vacates, and full tenancy history stay organized.

Your tax obligations

Part XIII
Non-resident withholding (CRA)

Any payer (your tenant or property manager) who pays rent to a non-resident of Canada must withhold 25% of gross rent each month and remit it to CRA. Failure to withhold makes the payer personally liable. This is the default; Section 216 lets you reduce it.

Section 216
Election to file on net rental income (CRA)

By filing a Section 216 return, you elect to be taxed on net rental income (after expenses) instead of the flat 25% on gross rent. In most cases the net-income tax is much lower than the withheld amount, so you receive a refund from CRA — usually within 90 days of filing.

NR6
Pre-election to apply Section 216 in-year (CRA)

If you file an NR6 form before the tax year, your withholding agent can withhold 25% on net rent (rent minus expected expenses) instead of gross rent. This avoids waiting a year for the Section 216 refund — your monthly withholding more closely matches your actual tax owed.

1040 + Schedule E
US tax return (IRS)

As a US person, the IRS taxes your worldwide income, including rental income from Canada. You report Canadian rental income on Schedule E attached to your 1040 — converted to USD using the Treasury yearly average exchange rate or another reasonable method.

Form 1116
Foreign Tax Credit (IRS)

After paying Canadian tax (via Section 216 or Part XIII withholding), you claim a foreign tax credit on Form 1116 against your US tax liability. The credit prevents double taxation under the Canada-US Tax Treaty.

FBAR
Foreign Bank Account Report (FinCEN 114)

If your Canadian rental property generates rent into a Canadian bank account, the year-end balance counts toward the FBAR $10,000 USD aggregate threshold. Filed annually with FinCEN, separately from your tax return.

How BorderBird helps

  • Monthly Part XIII tracking. The Remittances page shows your withholding obligation in real time using the 15th-of-month rule, so you can verify your property manager is remitting correctly.
  • Section 216 supporting data. Year-end T776 export gives your accountant gross rent, deductible expenses, and net rental income — the inputs Section 216 needs.
  • Foreign Tax Credit calculation. Total Canadian tax paid (via Part XIII or Section 216) flows to your Form 1116 worksheet for US side.
  • Schedule E in USD.Canadian rent and expenses converted at the year's annual average rate, mapped to Schedule E lines, ready for your 1040.
  • State-specific guides. Read the guide for your state-province combination — Florida→Ontario, California→BC, and more.

FAQ

Should I file Section 216 every year?
Almost always yes if you have meaningful expenses (mortgage interest, property tax, insurance, utilities, repairs). Without Section 216, CRA keeps the full 25% of gross rent — even if your actual net income would generate a much lower tax liability. The Section 216 return must be filed within two years of the end of the tax year, but most landlords file it with their regular Canadian return for that year.
What's the NR6 filing deadline?
NR6 must be filed before the start of the calendar year for which you want it to apply, OR before the first rent payment of the year if you have a new property. Late NR6 filings are not accepted retroactively for in-year withholding reduction — you'd just file Section 216 at year-end to claim back the over-withheld tax.
Who is responsible for the Part XIII withholding?
The payer of the rent — typically your Canadian property manager. If the tenant pays you directly with no resident agent in between, the tenant is technically responsible for withholding, which almost no tenant does. CRA's enforcement focus is on the recipient (you) when this breaks down. Hire a Canadian resident agent if your tenant won't withhold; this is a standard service offered by Canadian property managers.
Do I owe Canadian tax on capital gain when I sell?
Yes. Canada taxes non-residents on capital gains from Canadian real property. The seller (your lawyer) typically holds back 25% of the gross sale price until you obtain a Section 116 Clearance Certificate from CRA — this is the Canadian equivalent of FIRPTA. Plan for it; it can take CRA 4-8 weeks to issue the certificate.
How does BorderBird help with Section 216?
BorderBird tracks gross rent collected, deductible expenses (mortgage interest split from principal, repairs, property tax, insurance, utilities, etc.), and the resulting net rental income — in CAD, the currency Section 216 is filed in. The year-end T776 export gives your Canadian accountant the supporting calculations. We don't file Section 216 on your behalf; we give you the numbers.
Keep reading
All US state guides →Florida → Ontario guideCalifornia → BC guideSection 216 explainedPart XIII withholdingNR4 form guideCRA Part XIII calculatorSee the software →