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Just want to make sure I have this straight... I am USA resident, selling Cdn rental property.
I am going to request a Clearance Certificate. My understanding is I calculate the tax owing based on the selling price (not including real estate commission or legal fees) and this tax gets submitted at closing to CRA by my/purchasers lawyer. If the certificate doesn't come in on time, my lawyer holds onto 50% of purchase price (since depreciable property) until it comes in.
Next year I file a standard Non-resident return. Should get a tax-refund because disposition price is lower since we now consider legal fees and real estate commission. Otherwise there would be no refund/no owing.
I still should file a Section 216 for the rental income/expenses throughout the year - this income is not included on the Non-resident return.
Not sure that the witholding is as high as you claim
After 20 years, I am severely cutting back on responses. Do not ask specifically for my help. There are a few others on this board that can answer most questions. All the best
Seem teh lawyer is holding this amount to cover himself from any claim by CRA that the funds were disbursed with no clearance certificate. It is usually 25% of the gross,