Reporting Foreign Property Owned Outside of Canada: A Simplified Guide 

Are you puzzled about how to report foreign property you own outside of Canada? This guide aims to clarify the process for you, ensuring you’re well-informed when tax season arrives. 

• Do You Own Foreign Property Outside Canada? 
• If you own foreign property outside of Canada with a total cost of $100,000 or more, you’re required to file Form T1135, also known as the Foreign Income Verification Statement. 

• Understanding ‘Cost’ in T1135: 
• The term ‘cost’ refers to the amount you spent to acquire an asset. To determine the total cost of your foreign property, sum up the individual cost of each property. If the total is $100,000 or more, you need to file Form T1135. 

• What Needs to Be Reported? 
• Commonly reported foreign properties include shares in foreign corporations, land and buildings located outside Canada, and foreign mutual funds. 
• However, certain properties are exempt from reporting. This includes vacation properties, principal residences outside Canada, and foreign mutual funds within a TFSA or RRSP. 
• Canadian mutual funds, even those that invest in international stocks, are not required to be reported on T1135. 

• Filing the T1135: 
• Starting from the 2014 tax year, you can file Form T1135 electronically with the CRA. Before this, a printed copy had to be mailed. 
• Ensure you provide the following details for each foreign property owned during the year: 
• Description of the property 
• Income or loss from the property for the year 
• Maximum cost of the property during the year and at year-end 
• Capital gains and losses from selling the property 

• Key Takeaway: 
• If you own foreign property outside Canada, you might need to file Form T1135, the Foreign Income Verification Statement. Stay informed and ensure compliance to avoid potential pitfalls.