Glossary
T1159
Income Tax Return for Electing Under Section 216 (CRA)
The T1159 is the CRA return used to elect and report under Section 216 — letting a non-resident be taxed on the NET rental income from Canadian property at graduated rates, instead of paying 25% Part XIII tax on the gross rent. Net income is computed on a T776 and any over-withheld tax is refunded through the assessment.
Who it applies to: A non-resident who owns Canadian rental property and elects under Section 216.
Key facts
- Form
- CRA T1159 (Section 216 return)
- Taxes
- Net rental income at graduated rates
- Due
- 2 years after year-end — or June 30 if NR6 approved
- Uses
- A T776 for the net-income calculation
How it works
- Compute net rental income (gross rent minus expenses) on a T776.
- File the T1159 to be taxed on that net income at graduated rates instead of 25% of the gross.
- The assessment reconciles the Part XIII tax your agent already withheld — refunding any excess.
Related terms
Section 216
An election that lets a non-resident landlord be taxed on NET rental income at graduated rates instead of 25% of gross — usually producing a refund.
T776
The CRA form that reports a Canadian rental's gross income and expenses to arrive at net rental income or loss. Filed with a T1 return — or with a Section 216 return by a non-resident taxed on net.
NR4
The Canadian information slip a payer or agent files each year to report gross rent paid to a non-resident and the Part XIII tax withheld on it. Due March 31.
Frequently asked questions
What is the deadline for a Section 216 (T1159) return?
Generally within two years after the end of the tax year. If you filed an approved NR6 undertaking with your agent, the T1159 is due by June 30 of the following year.
Is the T1159 the same as a Section 216 return?
Yes. The T1159 is the CRA form used to make and report the Section 216 election — being taxed on net Canadian rental income rather than 25% of the gross rent.
This definition is general information, not tax advice. See the full guide above and verify current rules with the CRA or IRS. ← Back to the glossary
BorderBird helps cross-border landlords track rent and prepare CRA NR4 and IRS Schedule E filings — see how it works.